Life Insurance: Amitabh Chaudhry

My insurance policy lapsed last year due to non-payment of premiums. When I tried to renew, my agent asked me to undergo the medical tests. Is this required?
Your agent is correct in suggesting medical tests because, typically, a lapsed policy has to be medically underwritten if it has to be revived. The premium will not change unless your policy is rated up due to adverse medical reports/conditions. However, to revive the policy, you still will have to pay the dues (last year's unpaid premium) with interest and sometimes a revival fee, too.

I had taken a term life insurance policy while I was working. Later, I quit my job to take care of my child. I am thinking of discontinuing my policy, since I am not earning any more. Is it advisable to do so?
You might not feel the need to continue but we strongly suggest you to do so. If you begin working in future, the insurance coverage will be costlier with the increase in your age and the possibility of medical conditions. In case you change your mind while you are still not working and want to apply, you might be denied the grant of coverage under term policy because term cover to housewives is not offered.

Should I buy a term insurance with a personal accident cover as a rider or go for separate policies?
You can buy a term plan from any life insurance company and add accidental death and disability rider providing a lump sum on accidental death or disability. Here, the term of the rider cover is the same as the base plan and the premium will not change through the term. Personal accident covers are generally a one-year cover offered by general/health insurance companies, which might also provide additional benefits such as medical expenses, legal expenses, etc. You can renew the policy after one year but the premiums are subject to change. Hence, due to benefit levels and coverage term being different, the premiums for both are not comparable. One should assess carefully one's insurance needs and decide accordingly.

The views expressed are expert's own. Send your queries to yourmoney@bsmail.in
Amitabh Chaudhry, managing director and CEO at HDFC Life, answers your questions