Life insurance faqs

Under Section 88 of the Income Tax Act, tax rebate is provided to premiums paid to effect or to keep in force an insurance policy on the life of the assessees or on the life of the wife or husband or any child (whether minor or major). You can get deduction under Section 80CCC of the Income Tax Act for the contribution towards pension funds.

It is a method by which one’s transferable interest in a life insurance policy is transferred to another person or institution, for example, as a security for repayment of loans.

As soon as the life assured becomes a major, along with a covering letter submit to the insurance company the proof of his/her age, for example, any document like birth certificate or school leaving certificate showing the correct date of birth

It will be beneficial for you if you review your life insurance policy with your Insurance Planner periodically, say a year and update it according to your needs. It will help you cope with major life changes, like your marriage or birth of a child, by suggesting purchasing additional coverage. Along with that you can also save some money by taking advantage of lower rates.

Your present health condition and the impact of the surgery you underwent on it are considered while deciding your term policy premium. If you have undergone some major surgeries involving risk, you will be asked to pay a higher premium. Otherwise minor surgeries like dental surgery and hernia will not affect the premium cost.

Benefits offered by a term policy and a whole life policy are different; you need to choose a life insurance policy based on your needs and requirements. If you are looking at protection at low cost, then term policy is the best option. A whole life policy offers you the option of savings along with protection. Though you have to pay higher premiums, you also get the facility to withdraw some money as per your needs during different stages of life.

Your life insurance premium is calculated using four variables:

* Age of the policyholder
* Health of the policyholder
* Term of the policy
* Amount assured

Yes, you can change the beneficiary on your life insurance policy at any time and as often as you wish, till the maturity date. For this, you need to submit a duly-filled form indicating the new primary beneficiary with your insurance company.

You can select a basic life insurance policy depending on your age, health and income. It will come with no riders and provide the necessary protection at a low premium cost.

Life insurance is a legal agreement between an insured and an insurance company, stating that a said amount of money will be paid to the insured or the beneficiaries at the end of its term or upon the death of the insured. Apart from being the provider of financial security in the event of death of the insured or his/her inability to earn due to physical disabilities, it can also be an effective tool to create wealth. With a life insurance policy, you can save for your old age, fund your child’s education, save taxes and so on.