Monday, October 13, 2014
What's more important? Your car or you?
Motor insurance covers us for total write-off of the vehicle, damages and damages caused to others. In very much the same manner life insurance covers us for death and critical illnesses, though there is no comparable third party liability. Yet a large percentage of people driving around in fully insured cars are wary of similarly securing their own lives at roughly the same, if not cheaper cost.
This is exactly the kind of mind set that has for many years subdued the growth of the protection component of life insurance. People thought it was not worthwhile to pay for protection without getting anything back if they happened to survive the policy term. The question they never asked is what would happen if something were to happen to them and they were not insured? The answer to that question is frankly pretty depressing.
Just as motor insurance provides you with money to buy a new car in case of a total write-off, life insurance allows your family to ensure that they can maintain the lifestyle they are accustomed to in case of your death. As the bread winner it is your responsibility to ensure the financial security of your family. Also just as motor insurance provides you with cash to cope with accidents and damages, life insurance policies come with riders that protect you from undue financial strain in case of disability and illness.
Buying a life insurance policy that adequately covers you is not a decision that you should delay any longer. There are a host of online options available to choose from that can provide you with a life cover of Rs. 1 crore for just a few thousand rupees. Policies also come with riders, supplemental cover, to cover you for disability and critical illnesses. Just as you insure your car remember to insure yourself as well. Remember from your family’s point of view term insurance too is statutory.
COO- AEGON Religare Life Insurance
The other day I received a renewal premium notice from my motor insurance company. My first instinct was to click the ‘pay now’ link on the mailer and renew the insurance for my car. As I was completing the payment a thought struck me that the cost of insuring my car – a reliable, eight year old sedan with over 100,000 kilometres on the odometer – taking into account my no claim bonus, was almost the same as buying a term insurance plan for Rs. 1 crore for myself. And this was at my age in the mid-forties. Had I been younger my cost of motor insurance would have far exceeded the cost of insuring my life. That startling fact stopped me in my tracks. How come so many of us are happy to pay to insure our cars while we are so reluctant to pay for life insurance?