Some firms offer accidental death benefit and accidental permanent disability benefits with term plans but some do not. Why? While selecting a plan, should claim settlement percentage be considered?
Accidental death benefit (ADB) and accidental permanent disability (APB) benefit are optional riders, which can be attached to any policy. Of the two riders, ADB is more popular as it’s relatively inexpensive. APB is more expensive and has a long list of conditions/exclusions that makes it a less popular choice. Term insurance premiums don’t differ much between companies but the charges on riders differ for every company. This could be one of the reasons why companies do not offer any additional riders.
It is advisable to consider claim settlement percentage as it reflects on the company’s underwriting rigour and its effectiveness in claim investigation and payout.
I am 27 years old. I earn Rs5 lakh. Should I go for a pure term plan?
— Sachin V. Gadekar
It is good to have a term plan at a young age since the premium is relatively low then. You should have a risk cover of 10-15 times of your annual income at your age.
I have nominated my mother for a traditional policy. I want to include my wife’s name now. Is it possible?
— Surjit Sharma
For all insurance policies, you have an option of changing the nominee or including an additional nominee. In case a nominee dies before the policyholder during the policy term, the life assured (you) can change the nominee.
Amitabh Chaudhry, MD and CEO, HDFC Standard Life Insurance Co. Ltd