You can buy insurance online or offline. The offline medium includes contacting the agent or distributor of insurance companies or visiting insurance companies physically to buy the policy. The online medium, on the other hand, is simpler. You can buy any type of insurance plan from the comfort of your home or office if you use the online mode. The policy can be bought from the website of the insurance company directly or from the website of an insurance broker or aggregator like us.

Life insurance plans cover the risk of dying too early. Health insurance plans, on the other hand, cover the risk of medical contingencies. While life insurance plans pay a benefit in case of death or maturity, health insurance plans pay a benefit if the insured suffers a medical contingency which is covered by the plan.

Premium is the cost of insurance. It is the money which you undertake to pay to the insurance company in return for the coverage which the company provides.

Different insurance plans have a different coverage tenure. The tenures of various plans include the following -

• Life insurance - 5 years to 35 years

• Health insurance - 1 year to 3 years

• Bike insurance - third party plans - 1 year to 5 years; comprehensive plans - 1 year to 3 years or 5 years

• Car insurance - third party plans - 1 year to 3 years, comprehensive plans - 1 year or 3 years

• Insurance policies can be purchased online after comparing the different policies and then choosing the best one. After the policy is chosen you need to fill an online proposal form, submit the required documents and pay the premium online and the policy is issued.

• There are a lot of insurance policies available in the market each of which satisfy similar needs and yet have different coverage benefits and premium rates. The best insurance policy which provides the best coverage features at the lowest premium rates can be found only when the different plans are compared with each other. That is why comparing is necessary before buying insurance policies.

• A claim is said to occur when the insured event happens and the insurance company becomes liable to pay the compensation for the financial loss suffered by the insured.

Yes, insurance claims can be rejected due to various reasons. Some common ones include the following -

• If the claim is for an instance which is excluded under the plan’s coverage

• If the claim process is not properly followed

• If the claim is made in a policy which is lapsed

• If the claim related documents are not submitted to the insurance company

• Insurance policies come with a specified tenure. When the tenure is over, the cover provided by the policy stops. To continue the coverage, the policy is required to be renewed. Thus, renewal of an insurance policy means continuing the coverage of the policy for an additional tenure by paying the required renewal premium to the insurance company.

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• Renewal of an insurance policy should be done within the policy expiry date (also called the policy due date). If it is done within the due date, the policy continues without a break in coverage.

• If the insurance policy is not renewed within the due date, the policy cover would lapse as soon as the due date is over. When the policy lapses, the cover stops. If any claim is made in a lapsed policy, it is rejected as the coverage under the policy has stopped due to non-renewal.

• Premiums can be paid through cash, cheque, debit cards, credit cards, net banking facilities and also mobile wallets.

Life insurance plans come in the following variants -

• Term life plans

• Endowment plans

• Money back plans

• Whole life plans

• Child plans

• Unit linked insurance plans

• Pension plans

Health insurance plans come in the following variants -

• Indemnity health plans - individual health plans and family floater health plans

• Senior citizen health plans

• Critical illness health plans

• Disease specific health plans

• Hospital cash health plans

• Top up and super top-up health plans

Yes, life and health insurance plans provide tax benefits. These benefits are explained below -

Life insurance plans -

• Premiums paid for life insurance policies qualify for tax deduction under Section 80C upto a limit of INR 1.5 lakhs

• Surrender benefit, maturity benefit or death benefit received under life insurance plans are tax-free under Section 10 (10D)

• 1/3rd of the pension corpus which is withdrawn in cash is tax-free under Section 10 (10A)

Health insurance plans

• Premiums paid for a health insurance plan for self, spouse and dependent children is allowed as a tax deduction under Section 80D. The limit is INR 25, 000. If you are a senior citizen, the limit increases to INR 50, 000

• Premiums paid for health insurance plan for dependent parents earns an additional tax deduction under Section 80D. This limit is also INR 25, 000 which increases to INR 50, 000 if the parents are senior citizens.

Health insurance plans come in the following variants -

• Indemnity health plans - individual health plans and family floater health plans

• Yes, insurance policies allow a free-look period for cancellation of the policy after it has been bought. The period depends on the type of policy bought and the insurance company.

• If the insurance policy is cancelled during the free-look period, the premium paid is refunded back. However, the premium refund would be deducted for the administrative expenses incurred by the insurance company in issuing the insurance policy. Moreover, the insurance cost would also be deducted for the period the policy was in force before it was cancelled.

• A group insurance policy is one in which a group of individuals are covered under the same plan. A single insurance policy is issued covering all the members of the group and the policy is called a master policy. Group insurance plans usually come with a term of one year after which they have to be renewed for continued coverage.

• An insurance contract is a contract of utmost good faith. As per this principle, the policyholder is required to furnish all the important details about himself which are asked in the proposal form. The insurance company issues the policy on the good faith that the insured has provided every information in the proposal form correctly. If any important information, which affects the risk covered under the policy, is hidden or lied about, the principle of utmost good faith is breached. In such cases, the insurance contract becomes void and the insurance company has the right to reject the claim under the policy.

• General insurance policies pay a claim on the principle of indemnity. Indemnity means that in case of a loss the policyholder would be compensated by the insurance company for the actual financial loss suffered. The policyholder would not be allowed to make a profit from the insurance policy.

• The coverage level of your insurance policies should be optimum to cover the financial loss which is insured by the policy. In life and health insurance plans, the coverage level should be chosen based on the lifestyle expenses of the insured, the family size, age, income, etc. In case of car and bike insurance policies, the coverage depends on the value of the car and bike.

• No, insurance policies have a list of excluded coverage benefits which are not covered under the plan. These exclusions depend on the type of insurance policy.

• No, if the insurance policies are bought from reputed websites which are under the regulations of the IRDA, the policies would be genuine and would be issued by the insurance company directly.

• IRDA stands for the Insurance Regulatory and development Authority. It is the apex regulatory body of insurance in India. All insurance companies have to comply with the rules prescribed by the IRDA for selling their insurance policies.

Formalities for a death claim

When a person with a life insurance policy – called a life assured – dies, a claim intimation should be sent to the insurance company as early as possible. The assignee or nominee under the policy can do this. So can any close relative or the agent who handles the policy.

The claim intimation should contain information like the date, place and cause of death. The insurance agent has the duty to help the life assured’s family/ assignee to deal with the insurance company to fulfil the formalities for a claim.

The insurance company will respond to this intimation and will ask for the following documents:

• Filled-up claim form (provided by the insurance company)

• Certificate of death

• Policy document

• Deeds of assignments/ re-assignments if any

• Legal evidence of title, if the policy is not assigned or nominated

• Form of discharge executed and witnessed

Other documents such as medical attendant's certificate, hospital certificate, employer's certificate, police inquest report, post mortem report etc could be called for, as applicable.

Formalities for a maturity claim

Where a life insurance policy is maturing, the insurance company will usually send intimation to the policyholder along with a discharge voucher at least two to three months in advance of the date of maturity giving details like the maturity amount payable.

The policyholder has to sign the discharge voucher – which is like a receipt – have his signature witnessed and send it back to the insurance company along with the original policy bond to enable it to make the payment.

If the policy has been assigned in favour of any other person or entity – like a housing loan company – the claim amount will be paid only to the assignee who will give the discharge.

Formalities for a health insurance claim

You can make a claim under a Health insurance policy in two ways:

1. Cashless basis and

2. Reimbursement basis

On a Cashless basis: For a claim on cashless basis, your treatment must be only at a network hospital of the Third Party Administrator (TPA) who is servicing your policy. You have to seek authorisation for availing the treatment on a cashless basis as per procedures laid down and in the prescribed form. Please read the policy document as soon as you receive it to familiarise yourself with the process rather than wait for a claim to arise.

Claims on reimbursement basis: Read the clause relating to claims in your policy document as soon as you receive it to ensure that you understand the procedure and the documents required for making a claim on reimbursement basis. When a claim arises you should inform the insurance company as per procedures required. After hospitalisation, you have to ensure that you obtain and keep ready documents such as claim form, discharge summary, prescriptions and bills that you should submit for a claim.