Readers' Corner: Life Insurance

My wife and I both want to buy term plans. Should we buy a joint life policy or separate ones?

I would suggest you buy two individual plans, for yourself and your spouse, if both of you work. The objective of term insurance is to replace income loss and since both are working, individual policies would be best suited. Also, taking individual plans will help to customise according to one's need. You can choose the policy term and sum assured depending upon your age and future income. A joint life policy, if available, may restrict the coverage on younger lives.

I had purchased a life insurance policy from my bank. The bank's tie-up with that company has now come to an end. What do I do about my policy? How do I pay future premiums?

You should continue with the policy by paying regular premiums on due dates. The insurance company which has underwritten will provide the necessary service. Your bank is also liable to provide you with the necessary service as the policy has been sold by it.

I am getting messages from my insurance company to convert my policy into demat. What does this mean and how will it help me? Is there a charge for this?

Demat facility helps you maintain your document in digital format. Hence, it eases operational requirements like change in address, beneficiary, etc. The good thing is there is no charge for opening this demat account. The cost is borne by the insurance companies. This helps your nominee, as multiple policies are stored at one place and one claim intimation will trigger the requirement from all other policies as well. Similarly, change in address at the Depository Participant will lead to a change in address for all policies.

I had purchased a life insurance policy before I got married and my mother was the nominee. Now, I am married and my mother is no more. How can I make my wife the nominee?

To change the nominee in your policy, visit the nearest branch and fill a form which will be available there. The request will then go to the company, where the new nominee information will be updated for your policy. The process normally should take seven to 10 days.

Amitabh Chaudhry, managing director & chief executive officer, HDFC Life, answers your questions
The views expressed are expert's own. Send your queries to yourmoney@bsmail.in