Is it mandatory to buy a life insurance policy with a home loan?

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Life Insurance coverage coverage is a contract, and as soon as finalized can’t be modified.

– Kamlesh Rao

Q. I’m planning to buy a ULIP plan. How a lot does one must pay as costs? Additionally, does it assist in creating long-term wealth?

Ans: Broadly there are 4 classes of costs in a ULIP plan – premium allocation cost, coverage administration cost, mortality cost and fund administration cost. These costs fluctuate from product to product and rely on the policyholder’s age. A Unit Linked Plan is amongst one of many common funding selections for long-term wealth creation. Along with the funding, it additionally presents life insurance coverage cowl together with tax-free returns.

Q. I want to change the nominee in my insurance coverage coverage. How can I am going about it?

Ans: You possibly can change the nominee of your insurance coverage coverage by sending an electronic mail request to your insurer or on-line on the corporate’s web site. You may also go to the closest department of your insurance coverage supplier and lift the request. The method will probably be initiated when you submit a written request for altering the nomination together with the explanations, the title and relationship with the brand new nominee, and the identical will probably be carried out.

Q. I’m taking a housing mortgage and have been advisable to purchase a life insurance coverage coverage. Is it necessary? Can I present my present insurance policies as a substitute to the banker?

Ans: One’s personal home or property supplies immense safety to 1’s family members. Nonetheless, one should pay attention to the truth that life is unsure, and one can by no means predict what the long run beholds. An unlucky occasion can put your loved ones’s monetary future and life-style at stake. The house mortgage EMI can take a heavy toll. One ought to subsequently perceive that the stakes are excessive, and one shouldn’t threat it. It’s at all times advisable to go for a life insurance coverage plan and hyperlink it to the mortgage, as it can cowl your house mortgage legal responsibility whereas making certain that the burden doesn’t fall on your loved ones in case of an untoward occasion. Nonetheless, it isn’t necessary to buy a coverage on the time of taking a housing mortgage. You possibly can both buy a brand new coverage or can assign an current life insurance coverage coverage to the financial institution.

Q. I’m planning to buy a time period plan. If I go for a Rs 60 lakh cowl now, can I enhance the sum assured to a crore after a few years?

Ans: Life Insurance coverage coverage is a contract, and as soon as finalized can’t be modified. Subsequently, you wouldn’t be capable to change the sum assured worth of your coverage, as soon as finalized on the time of buy. Should you really feel that you’d want increased cowl after a few years, you may go for the next sum assured proper now, on the time of buy. Being youthful, you’re going to get the coverage at a a lot decrease premium, which could be locked-in for your complete coverage time period. Alternatively, you may as well go for the growing sum assured possibility, whereby the quantity will increase by 5% – 10% of the fundamental sum assured yearly. This can guarantee that you’re adequately insured at each life stage. So, earlier than buying the time period plan, consider your present age, monetary obligations, well being situation, financial savings and future life targets after which go for the suitable sum assured.

(The spokesperson is the MD and CEO, Aditya Birla Solar Life Insurance coverage)

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