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By:

Kaustubh Kale

10 September 2024 at 6:07:15 pm

Everything About Term Life Insurance

“Jo bachchon se kare pyaar, woh term insurance ko kaise kare inkaar!” If you love your family, term life insurance is indispensable. Financially securing your loved ones in the event of an untimely death is crucial, and term insurance offers this protection at an affordable cost. Protection, Not Investment Term insurance is the simplest form of life insurance. You pay a relatively small premium and receive a large life cover for a fixed period. Unlike endowment plans or unit-linked insurance...

Everything About Term Life Insurance

“Jo bachchon se kare pyaar, woh term insurance ko kaise kare inkaar!” If you love your family, term life insurance is indispensable. Financially securing your loved ones in the event of an untimely death is crucial, and term insurance offers this protection at an affordable cost. Protection, Not Investment Term insurance is the simplest form of life insurance. You pay a relatively small premium and receive a large life cover for a fixed period. Unlike endowment plans or unit-linked insurance plans, it does not combine insurance with investment. This separation is important. Insurance should protect your family, while investments should help you create wealth. Traditional insurance-cum-investment plans often provide modest returns that may struggle to beat inflation over long periods. For many people, buying adequate term insurance and investing separately through suitable mutual funds or other investments can be a more efficient approach. For instance, a healthy person in their thirties may be able to purchase a term cover of Rs 1 crore for approximately Rs 15,000 to Rs 20,000 annually, depending on age, health, policy tenure and other factors. Insurance Needed You should strongly consider term insurance if your spouse, children or parents are financially dependent on you. It is also essential if you have liabilities such as a home loan, car loan or personal loan. Even a non-working spouse may require life insurance because replacing the economic value of household responsibilities, childcare and family management can be expensive. To summarise, if you have loans or plan to take loans, have children or plan to have children, or have a financially dependent spouse or parents, term life insurance is an absolute must. Enough Cover A figure such as Rs 1 crore may sound large, but it may not necessarily be sufficient. The right amount should be calculated based on your family’s actual financial needs. First, estimate household expenses. If your family spends Rs 10 lakh annually and you want to provide for the next 15 years, you may require at least Rs 1.5 crore for basic living expenses. Second, add all outstanding loans. A home loan of Rs 35 lakh and a personal loan of Rs 5 lakh would increase the total requirement to Rs 1.9 crore. Third, include future financial goals. If your children’s higher education is expected to cost Rs 50 lakh, the required cover rises to Rs 2.4 crore. Fourth, provide an additional amount for your dependent parents or spouse. Adding Rs 20 lakh would take the total requirement to approximately Rs 2.6 crore. Finally, adjust the calculation for inflation. Inflation gradually erodes the value of money. To ensure that your family has enough to meet rising expenses, it is wise to add an appropriate inflation adjustment to each of the above steps, as necessary. Do Not Delay Term insurance is generally cheaper when purchased at a younger age and while you are in good health. Disclose all medical conditions, lifestyle habits and existing policies honestly, as incorrect or incomplete information can create difficulties during claim settlement. Life is uncertain, but your family’s financial security need not be. The purpose of term insurance is simple: even in your absence, your responsibilities should continue to be fulfilled. (The author is a Chartered Accountant and CFA (USA). Financial Advisor. Views personal. He could be reached on 9833133605.)

Newly married worker dies after electrocution

Badlapur: A 24-year-old worker died after allegedly suffering an electric shock while installing a banner on a hoarding near D-Mart on the Katai-Karjat State Highway between Ambernath and Badlapur on Saturday, bringing the issue of worker safety and compliance with safety norms at hoarding sites under renewed scrutiny. The deceased, identified as Indresh Rajbhar, was a native of Uttar Pradesh and had reportedly been married only two to three months ago.


According to information received, Rajbhar had come to Maharashtra in search of employment and was residing in Thane. He had gone to the site in the morning to carry out hoarding installation work. Preliminary information suggests that he received a severe electric shock while putting up a banner on the roadside hoarding and subsequently fell from the structure.


Following the incident, his colleagues rushed him to the Sub-District (Rural) Hospital in Badlapur for treatment. However, doctors declared him dead upon examination. Rajbhar's co-worker, Anand Rajbhar, stated that the deceased had got married just two to three months earlier.


Upon receiving information about the incident, Badlapur Police reached the spot and conducted a panchnama. The body has been sent for post-mortem examination at the Sub-District Hospital, and further investigation is underway.


Police are currently investigating the exact circumstances under which the electric shock occurred, whether mandatory safety protocols were followed during the installation work, and whether the workers had been provided with the necessary safety equipment.


Meanwhile, preliminary information indicates that the work may have been carried out on the elevated hoarding without adequate safety measures. Local residents have alleged that safety precautions are often neglected during the installation of hoardings and banners.


While speaking to, ‘The Perfect Voice’, social activist Pravin Gosavi said that he had filed a Public Interest Litigation before the Bombay High Court regarding unauthorized hoardings and had submitted multiple complaints to the municipal council over the past five years. He alleged that the administration's failure to act on these complaints appears to have contributed to the unfortunate death of worker Indresh Kumar Rajbhar.


Gosavi further demanded that a culpable homicide case be registered against those responsible for the incident and called for a thorough investigation into the matter.

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