Fully Insured

POSTED BY Vikas Joshi ON April 24, 2013 4:11 pm COMMENTS (6)





Am not a financial expert, but in my mind, being sufficently insured in terms of life & health is the first step any should take before venturing into the world of equity, debt, mutual funds etc.

With this philosophy as a background, I got a couple of term insurence & a health insurance.

However, of late, I feel a need to review my cover.

Dear All, request you to kindly guide me with my case.




I currently have the following plans-

Lic Term Plan – 25 Lacs – (8,600) Premium
Kotak Preferred Term Plan – 50 Lacs – (8,820) Premium
Individual Health Guard – 1 Lac – (1,923) Premium

I got married last year & feel that I should review the above.
To my mind Lic Policy is extremely expensive & am considering discontinuing it.
I intend to be insured for 1.5 Cr, kindly suggest 2 term plans in addition to the 50 Lac Kotak plan I have to be able to meet my goal. Also, I want a plan with Permanent disability rider as it is missing in my plan thus far.

Also, Kindly suggest changes should be made to my health plan so it covers my my wife as well (Family floater may be??). Am satisfied with Bajaj & intend to continue with them. I intend to get my critical illness & hospitilisation covered here.

Finally, kindly suggest a personal accident cover for me in case of eventuality as I am the primary bread earner.

My age is 30 & monthly income 50,000 p.m

Thank you in advance & awaiting your valuable inputs  


6 replies on this article “Fully Insured”

  1. Vikas Joshi says:

    Dear Mahavir,
    Thanks for your inputs – Much appreciated.
    As rightly suggested by you, am aware that the 1 Lac Health cover I have right now is insufficient & I intend to upgrade to a family floater in this renewable cycle.
    Is there a thumb rule on the cover size. You have suggested 5 Lacs – Can you plz help understand.

    On the Personal Accident Cover part, I looked up the Bajaj site & found the following.

    Need you guidence on two points
    1. How to calculate the approximate cover for a Personal Accident Cover which includes all categories of disability.
    2. Is a plan which combines both health & Personal Accident – If yes, is it recommended?


    Dear Ashal,
    Term insurence is fundamently taken to be a financial support system for family in case of any eventuality.
    The value of Rs 50 lakh will only be Rs 28 lakh after 10 years assuming an inflation of just 6%.
    My calculation is based on the simple formula that Term plan should cover for 20 years of current income.

    -Vikas Joshi

  2. Dear Vikas, how did you arrive @ 1.5Cr. term cover? Any calculation or just your comfort no?

    Please clarify.



  3. Vikas Joshi says:

    Dear FFC,
    Understood the point – Thank you.
    To add, I fully agree with you on the complexity part.

    Thanks again for your valuable inputs.

    -Vikas Joshi

  4. Vikas I understand you need only 1 Cr more (read my answer again). The insurer may or may not give that to you considering:
    1. Your monthly income
    2. Your current insurance of 75 Lakhs. 50 lakhs if you convince them you will drop the LIC. This may or may not work

    Make sure you disclose both

    Why 3 plans? Two should do. Remember it will be a big hassle for your nominee to claim from 3 insurers if it comes to that. Even 2 plans will an issue in case the situation is complicated.

  5. Vikas Joshi says:

    Dear FFC,
    Thanks for your inputs.
    Just to clarify, I do not intend to take a 1.5 Cr policy. The intent is to buy max of 3 term plans totaling up to 1.5 Cr.
    Since I already have the Kotak plan of 50 Lacs that leaves the gap of 1 Cr.

    With above in mind & your advise, HDFC click2protect is one policy I will take up for 50 lacs.

    This leaves a gap of 50 lacs, can you suggest another plan. Am currently divided between icici icare & BSLI Protector Plan. Only catch is BSLI Protector Plan is not available online.

    Only Upon buying the two new term plans as you suggest will surrender the LIC policy.

    Looking forward to your inputs.

    -Vikas Joshi

  6. Dear Vikas,

    For a 50K salary not sure if you will get a 1.5Cr total cover.
    Assuming you have the Kotak plan until about 60,
    I suggest you take another plan for 1 Cr (you apply for 1 Cr they made reduce it) from AVIVA online plan or HDFC click2protect until your retirement.
    Don;t stop the LIC policy before getting the cover and inform the full details of both polices when you apply for new one.

    Permanent disability or accident insurance is very cheap to buy separately.
    Get it from a PSU like United India
    However whichever way you go the cover will be small.
    Yes get a family floater mediclaim.
    Critical illness can be taken up after you do the above.

    Ps. whether one ventures into world of equity debt or not insurance is important.

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