The importance of a life insurance policy in an individual’s financial planning can never be understated. According to insurance regulator IRDAI’s annual report, insurance penetration stands at a measly 2.82%.
One big reason behind this trend is that people treat buying insurance policy as an expense. But citizens need to understand that it is a protective shield that will take care of family’s expenses in case of any unfortunate incident.
In an interview with Money9, Raj Khosla, MD of My Money Mantra, reiterated the importance of having an insurance policy.
According to Khosla, if the complicated products of life insurance seem intimidating, an individual should opt for a basic term insurance.
“You should choose term insurance based on age, number of people dependent on you and your financial responsibilities such as loans,” he said.
As a step towards boosting insurance penetration in the country, private companies have been asked by IRDAI to offer Saral life insurance products.
In addition to the term plan, there are also insurance plans that offer returns in addition to protection such as ULIP, Endowment and Guaranteed Pension Plan, an individual can choose them only if you have a basic cover.
In this interview, Khosla tells you about the factors you should consider before buying an insurance policy.
Watch the video for the full interview:
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