Financial Planning · Insurance

Did you secure your family’s future?

Six months is all it took to deal a shock to the family. And the family income went for a toss.

I was reminded of the Mahabharata’s Yaksha story where the Yaksha asked Yudisthira,”what is the most surprising thing in this world?” Yudisthira replied that all living beings have to die one day is certain but the most surprising thing is that all of us can’t imagine ourselves dying!!

It was a trigger for me to review my financial protection plans for my family just in case something happened to me.

Later, talking to the wife of Prafull, the society member who lost his fight against cancer, she was worried about managing the lump sum money received from the insurance company. She asked me how to setup a system where she gets a monthly payout for all the expenses instead of the lump sum amount.

A monthly expense account is a genuine requirement. I have heard stories of the lump sum amount getting frittered away in unnecessary expenses or getting invested in illiquid instruments.

According to my limited knowledge, most insurance companies give a lumpsum sum assured payment to the nominee in case of an unfortunate death of the policyholder.

While reviewing and comparing the features of the various risk cover insurance plans, I came across this plan by Edelweiss Tokio Life where the policyholder can choose his pay out options – lumpsum, monthly or a combination.

In the monthly payout, the payout (sum assured) will be done on monthly basis.  This will help your family to manage recurring expenses like household expenses, EMIs, utility bills, etc

A combination of Lumpsum and Monthly: A combination of both lumpsum and monthly can also be chosen to fulfill your family’s immediate and recurring needs. For example, your suppose you have a home loan. In this case, your family can pay of the loan and also manage the household expenses.

In Edelweiss Tokio Life – MyLife+  pure term insurance plan, one can add benefits in the form of riders like accidental death benefit, accidental total and permanent disability rider, waiver of premium rider. Accidental Total and permanent disability rider provides a lumpsum amount incase the policyholder is permanently disabled due to an accident. A waiver of premium rider will waive off all future premiums incase the policyholder is diagnosed with a prelisted critical illness. These riders add a lot of value to the policy. By adding these riders to your plan you can ensure complete protection for your family members.

I also noted that this plan is available for a longer life cover upto the age of 80 while generally most insurance companies provide a cover upto age 70. In this age of increasing longevity, this is a good feature to have in your family income protection plan.

You can take a look at the YouTube video about this plan called MyLife+.

While the financial services industry provides products for insurance and investments, it’ll be awesome if they can customize their products according to the needs of the customer.

Money management means different things to different people and can’t be done in a “one-size-fits-all” manner. That’s the reason it’s called personal finance.

It’s good to see that Edelweiss Tokio Life is listening to the needs of customers and even has a tagline that talks about customizing their products according to the needs, Insurance Se Badhkar Hai Aapki Zaroorat!

Did you plan for your family’s financial security in your absence?

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