Life insurance: Anuj Agarwal

Are there both a critical illness rider and a standalone cover available? If yes, how do I decide if I need a standalone cover or a rider?
Yes. Critical illness riders are provided by life insurance companies whereas standalone critical illness products are provided by general insurance companies. Critical illness riders are for a longer duration, that is, till the end of the term of the main base policy, usually a pure life insurance or term plan. Whereas standalone critical illness policies provided by general insurers are of annual duration and need to be renewed every year.

You should chose between a rider and a standalone product, depending on requirement and convenience. It's also recommended that you compare and evaluate the rider and standalone policies on various parameters like list of illnesses covered, claim settlement record, claims procedure and the coverage offered.

I am 32 and don't have a life insurance cover. My parents stay with me but aren't exactly dependent on me monetarily. My wife works and is covered for Rs 15 lakh. How much insurance should I buy?

Ideally, you should also have a life insurance cover, which, as a thumbrule, should be at least 10 times your annual salary. Based on your financial goals and ability to pay the premium, determine the cover you want to buy. You can use online calculators to arrive at the right cover or, better still ask your/a financial advisor.

You should also periodically review the cover, based on changing life stage needs and financial goals. For instance, increase your life cover when your salary increases or when you have a child and so on.

I am 59 and will retire in six months. I have a pure life insurance policy that covers me till February 2015. I have a daughter who is physically and mentally challenged. Should I buy another life cover? Will I get one, if I buy one now itself?
The maximum entry age for most insurance plans is 60 to 65 years. You are still eligible to buy one for yourself. However, to take care of your daughter, it is better to buy an immediate annuity plan with the return of capital option, to ensure sustainable income at regular intervals. This will ensure your daughter gets a lumpsum amount in case of your untimely death.

The views expressed are the expert's own. Send your queries to yourmoney@bsmail.in

Today, Anuj Agarwal, chief executive officer of Bajaj Allianz Life Insurance, answers your questions