Best Insurance Cover For Your Home Loan

Best Insurance Cover For Your Home Loan: A home is a place where dreams are built, memories are treasured and relationships are reinforced. Buying and owning a dream home is an aspiration all of us have and it is one of the most important financial decisions you will need to make. Most Indians who decide to buy a home opt for a Home Loan. A Home Loan is one of the longest debts in your life, which requires a long-term commitment. You owe money to the lender and this increases your risk profile. A Home Loan insurance plan mitigates this risk.

Why You Need Home Loan Insurance

Your Home Loan needs to be paid off to the lender in the form of Equated Monthly Instalments (EMI) over the tenure of the loan. This liability needs to be repaid to the lender, irrespective of whether you are alive or not. In case of your untimely death during the term of the loan, your family members will need to repay the loan. Home Loan insurance ensures that the insurance company pays off the outstanding loan amount in the eventuality of your death, thus protecting your family members from the burden of repaying the Home Loan.

How Does Home Loan Insurance Work

The working of a Home Loan insurance is similar to a Term Life Insurance policy. The differentiating factor between the two insurance policies is that in the case of a Home Loan insurance, the sum assured is not a fixed sum, but will be equal to the outstanding home loan amount. In other words, the insurance cover available under a Home Loan insurance policy keeps reducing with the payment of EMIs, which reduces the outstanding loan amount. In some cases (for example, the Home Safe Plus scheme of ICICI Bank), the cover available is on a flat basis instead of a reducing basis. In this case, a fixed amount is paid out to the beneficiary irrespective of the outstanding loan amount.

What Is The Eligibility Criteria

Home Loan insurance eligibility criteria differ from one company to another. The minimum entry age is 18 years. The maximum age of the borrower while availing the Home Loan insurance is usually 50 years for most banks; some banks extend this to up to 60 years. Some banks also stipulate the maximum age of the borrower on the expiry of the policy

Read Also 5 Ways to Avoid Life Insurance Claim Rejection

Premium Payment

The amount of premium depends on:

Age of the borrower- Premium increases with age of the borrower. Usually, insurance companies insist on medical tests beyond 40 years. Below this, a simple declaration is sufficient.

Amount and tenure of the Home Loan- Premium increases with the duration of the loan and amount. Even for the same insurance cover, a higher term will result in a higher premium.

Borrower�s medical record- If the borrower is in good health, premium will be at regular rates. For example, if you have had a heart attack in the past, the premium you will need to pay will be higher than a borrower with no past incidents.

Insurance companies generally insist on a one-time payment of the premium. However, in most cases where insurance is taken from the company with which the Home Loan lender has a tie-up, the premium amount is bundled with the loan and included in the EMI amount. For example, if the Home Loan is for Rs. 20 lakhs and the insurance premium is for Rs. 2 lakhs, the lender pays the entire premium amount to the insurance company upfront. The new loan amount will now be Rs. 22 lakhs, which will be spread out as EMIs over the tenure. So in effect, you will be paying interest on the Rs.2 lakhs premium amount also.

What Is The Claim Process?

Home Loan insurance policies are taken in the name of the borrower of the Home Loan. In the case of death of the borrower, the onus lies on the family members to file and obtain the claim amount. If the claim is passed, the amount is directly paid to the lender or to the family member beneficiary. As in the case of all term insurance policies, in case the borrower is alive beyond the term of the policy, he does not get back the premium paid.

How To Choose The Right Insurance Policy

It is not compulsory to take a Home Loan insurance policy from the lender/group company of the lender. Usually, Home Loan lenders tie-up with insurance companies and recommend borrowers to secure the policy from them. But as a borrower, you can secure a Home Loan insurance from any company. You can either avail the policy along with the Home Loan or at a later date.

Though it is not mandatory to have an insurance policy to cover your Home Loan, it is highly recommended to have one to reduce the burden on your family. It is always better to scout the market, do a thorough research and compare policies from different companies before deciding which insurance policy to purchase.

How To Avoid Common Health Insurance Distress

How To Avoid Common Health Insurance Distress: A Health Insurance cover is meant to cover your medical treatment at the best of hospitals and keep you stress-free from the financial strain aspect. However, one may encounter some distress due to health insurance issues and such situations are difficult.

Let�s check out how you can avoid health insurance distress.

Not Getting Cashless Claim

People opt for a Health Insurance policy expecting they won�t be required to pay money under medical emergency. This being true to some extent, there are certain caveats attached to the cashless facility one should be aware of. You are allowed to claim cashless hospitalisation benefit if you get the treatment in the network hospital, which is mentioned in the policy document list.

Also, there are situations when the insurer may not be able to identify the insured on time, and the hospital may ask the insured to settle the bill from his/her own pocket. In this case, an exorbitant hospital bill can cause considerable stress.

To avoid such situation s, you must check whether the hospital is listed in the policy document for a cashless facility or not. It is always advisable to get a pre-approval from the insurance company to avoid any authorisation delay. Even after taking all precautions you are unable to avail a cashless facility shouldn�t be a big worry.

You can always get the money reimbursed by completing the procedure prescribed by the insurance company. Normally the money is reimbursed in 15 to 30 days of filing the request.

Premium Increase

The premium may increase due to change in the age slab or due to changes in the cost structure of the insurance company. After continuing the health policy for a long period if the insurance support arises but the premium has increased manifold, the cause of distress could considerably go up.

Normally, the insurance regulator restricts the insurance companies from spiking the insurance premium exorbitantly. However, even a moderate increase could be a burden on the insured person. In such a scenario, you can use the porting option and switch the policy to another insurance company which offers similar cover and charge a  lower premium. Normally, all the benefits such as no claim bonus and passed time to get cover for pre-existing diseases continue with the switched policy.

Also, Read Top 10 Factors Affecting Life Insurance Premium Costs

Change In Terms And Condition

Sometimes health insurance companies change the terms and conditions in their policy document. It may include or exclude particular disease from the list or add or remove a hospital from the network list.

If you find it difficult to accept the change in the terms and condition, then you can switch the insurance company by using the porting option. Sometimes, insurance companies include the cover disease s which were not allowed earlier, but at the same time increase the premium to that extent. In such a situation you must compare the policy once again with others available in the market and decide based on available merits and demerits.

Cover Not Allowed Due To Pre-existing Clause

Pre-existing ailments are not covered for a specified number of years. If the insured person forgets this clause, then they may need to pay all the treatment cost for such pre-existing diseases from their own pocket.

It is important that you clearly mention the pre-existing ailments at the time of purchasing the health policy. If you are buying health policy after an age of 45 years, then it is better to attach the health screening report with the application to avoid dispute in claim settlement in the future.

Paying From Pocket Despite Health Insurance Cover

Exclusion list may vary from one insurance company to another. If you have switched the insurance policy from one company to another through porting option, then your exclusion list may change as well. Suppose, your earlier insurance company may have allowed treatment of dental problem after a waiting period of 2 years, but after porting, the new insurance company may not allow dental treatment at all.

You must check the exclusion list before porting the policy and always check the exclusion list of the existing policy before you renew it.

Hence, performing due diligence before buying a health policy can help in reducing the chances of distress to minimal.

5 Best Single Premium Insurance Plans in India

5 Best Single-Premium Insurance Plans in India:  A single insurance endowment plan is a one-time payment insurance policy that has been created for customers who do not want to endure the hassle of keeping a tab on the plan and making regular periodic payments. This type of plan can be termed as a �fill it, shut it, forget about it� type of policy. Here, you make one large payment, become the owner of a single premium policy, and then forget about it until the term of the policy expires.

When do you really require a single premium policy?

There are a lot of life insurance agencies that provide a single insurance policy. A lot of us prefer making an investment when we come across a large amount of money. This could come in the form of a yearly bonus, an investment payout, or even a family inheritance. A large amount of money comes as a good investment opportunity and a single insurance plan is a good route to take. This can also be used for availing tax benefits when you file your taxes towards the end of the fiscal year. You are entitled to an exemption of up to Rs.1.5 lakhs.

Also, the main benefit of a single insurance plan is that you do not have to ever worry about your policy getting lapsed. As a large single amount has been paid as a premium for the policy, the plan will not require additional payments to be made towards the premium. As this is the case, you will not have to ever worry about the policy lapses due to a missed payment apart from other reasons.

Let us now take a look at the top 5 single insurance plans that are offered in India:

• LIC�s Jeevan Vriddhi: The Jeevan Vriddhi plan offered by LIC is a premium endowment plan that offers risk cover which is a multiple of the premium that is chosen by you. This plans offers a number of benefits with Loyalty Addition and Guaranteed Maturity Sum being the most evident ones.

Time Period	10 years
Entry Age Minimum-Maximum	8-50 years
Sum Assured (Minimum)	Rs.1,50,000
Sum Assured (Maximum)	Nil
Minimum Premium available	Rs.30,000

• Aegon Religare iMaximize Single-Premium Insurance Plan: Reap investment benefits by making a one-time payment for this plan. Aegon Religare iMaximize single insurance plan provides 3 different choices of investment funds that help in maximizing your funds. There are no allocation charges and therefore there are more funds that are made available for different investment purposes. You can choose to pick up this investment plan when choosing a life insurance policy as this plan doubles as an insurance policy.

Time Period	5 or 10 years
Entry Age Minimum-Maximum	8-60 years
Maturity Age Minimum-Maximum	18-65 years
	Entry Age	Term of the Policy
Available Policy Term	Equal or before 50 years	10 years
	Post 50 years	5 years
	Lesser than 45 years	More than or equal to 45 years
Minimum Sum that is assured	125% of the single premium	110% of the single premium
Minimum Premium	Rs.1,00,000

• ICICI Prudential iAssure Single-Premium Insurance Plan: This is a single premium endowment plan. This plan is all about tradition and does not have any bonus facilities. This plan is similar to the other plans that are mentioned here. You are required to make a one-time lump sum payment that would allow the policy to continue for the entire tenure of the policy. A Guaranteed Maturity Benefit is provided to the policyholder at the end of the tenure and if the policyholder survives for the tenure of the policy. However, if the policyholder meets with an early and unforeseen death, then the nominee of the policyholder will get the higher value between Guaranteed Maturity Benefit and Sum Assured.

Duration	5 or 10 years
	Duration in years	Age in years
Minimum Age	5	13
	10	8
Maximum entry age	70 years
Minimum entry age	18 years
	Duration in years	Age in years
Age at maturity	5	75
	10	80
Minimum sum that is Assured	125% of single premium
	Age at entry	Sum that is assured
Maximum sum that is assured	Up to 55 years	500%
	56-70 years	125%
Minimum Premiums	Rs.20,000

• Max New York SMART Steps Single-Premium Insurance Plan: This is an endowment plan that is aimed at making the lives of children a lot better. It is mainly aimed at planning and providing for the financial needs of children.

Life insured	Parent
Age of the insured	21-50 years
Age of the child	91 days-15 years
Maximum Maturity (Life insured)	60 years
	Minimum	Maximum
The term of the policy	10 years	25 years
	Band 1	Band 2
Premium Bands	Rs.50,000-Rs.2,99,999	Rs.3 lakhs and above
The sum that is assured	5 times the Single Premium
Minimum Premium	Rs.50,000
Charges for allocation	Depends on the premium brand that is chosen

• HDFC Life Single Premium Pension Super: This is a ULIP policy that generates corpus over the term of the policy which would produce a post-retirement income.

Time period	10 years
Entry Age (Minimum)	40 years
Entry Age (Maximum)	75 years
	Minimum	Maximum
Maturity Age	18 years	65 years
Maturity Benefits	101% of single premium made

Keep in mind that apart from financial stability, a single premium plan also offers tax benefits and is only available in the first year. You also ensure that you are making use of any lump sum of money that is lying around without just letting it rot in your piggy bank. The number of different single insurance plans offered by insurance agencies is never lacking. You can also visit a policy aggregator website like bankbazaar.com to compare and check different policies and choose one that matches your needs and requirements perfectly.

5 Ways to Avoid Life Insurance Claim Rejection

5 Ways to Avoid Life Insurance Claim Rejection: More often than not, getting claims honoured by life insurance companies is an uphill battle. There are so many clauses, conditions and exceptions in insurance policies today that people are expected to fall ill by contracting a specific disease under specific conditions at a specific time in the day and inform the insurer at a specific time through a specific channel, and only if you�re under a specific insurance plan. Failure to meet any of these conditions would result in no insurance benefit being paid out, and the company is legally allowed to tell your dependants to take a hike.

Most often, insurers rely on legal loopholes and clauses in their policy documents to avoid making payments of sums assured, but a surprisingly large number of times, the fault and blame belong to the customers themselves.

Here are seven things you as a customer can do to ensure that you always get paid what�s due to you by your life insurance provider.

1. Don�t conceal information.

   Literally, any bit of information you don�t (or forget to) tell the life insurance company which can have an impact on your health, or result in any medical condition that requires hospitalization or the payment of death benefit is considered as �concealment of information�. Any disease or ailment requiring you to make a life insurance claim will be tracked back and traced to anything in your application form that indicates that this disease or ailment was a possibility. Any pre-existing disease or condition or smoking/drinking habits or anything that can be linked as being a cause to your hospitalization or death will be investigated and, if you haven�t told the company about it, sum assured and other benefits will not be given to you or your dependents. Your premiums are decided on this information, so be clear and open while furnishing it. If there is nothing that you�ve concealed, there�s nothing that can be held against you and the insurer will have to pay your sum assured.

2. Pay your premiums on time.

   Insurers will only settle claims on active insurance policies. There is an astonishing number of people who do not understand that delaying premium payments result in lapsed policies. Once your policy lapses, you are no longer covered and all your premiums paid that far will be rendered useless. The premiums will neither be returned to you nor will they have any legal validity to ensure that you or your dependents get your sum assured or death benefit from the company. In some cases, delaying your payments could also lead to penalty charges and reinstatement charges. Also, if you have a clean track history of making premium payments, the insurer will have one less point to haggle over when it comes time for a settlement.

3. Update nominee information.

   Your named nominee is the person who will receive any and all benefits that come out of your insurance policy when the time comes. If you�re single, naming your parents as nominees would be the sensible way to go. Once you�re married, name your spouse and children. Whatever your present relationship status is, always keep a nominee named so that some benefit will go to some dependent of yours somewhere. Nominees are generally those whose livelihoods are directly dependant on you being alive and well.

4. Don�t delay in filing insurance claims.

   It may be the last thing on your mind in a medical emergency, but a quick call to your insurance company could spell the difference between having or losing insurance cover. It�s a good idea to give a trusted friend, colleague or relative your emergency insurance information to call and intimate the insurance company in case you are unable to do so yourself. Basically, the life insurance company needs to be kept posted about the events for which they will be held financially liable later. The sooner you intimate the company about whatever has happened that requires medical attention, the easier your claim processing will be. Insurers also consider delays in intimation of hospitalization as indicators of potential fraud. Timely intimation can also keep you clear of this accusation.

5. Fill out your insurance application form yourself.

   Do not trust that well dressed, constantly smiling, and question-avoiding insurance agent with the responsibility of filling out your forms. Insurers decide your premium payment amount, overall coverage, and even some exclusions based on what�s filled out in your forms. Merely telling the insurance agent everything about your medical history will not qualify him to understand and explain on the form the more difficult intricacies of your medical history. You will need to take the time out of your day and get your records in order and truthfully fill out all the details in the forms by yourself. No one knows you better than you, and you need to make sure the insurance provider knows, too. Withholding tobacco and alcohol consumption habits will be a problem if the reason you�re hospitalized can be traced back to alcohol or tobacco consumption. Agents fill forms fast to meet sales targets, and couldn�t care less what becomes of you in the future. Is that a person you want to trust with potentially huge amounts of money that could become due to your dependants in their most dire times of need?

Keep yourself informed and abreast of all developments with your insurer. Keep yourself informed about the details in your policy document. Stay diligent and well informed about the conditions under which you will be eligible for a claim. Life insurance is not just a tax saving tool, it�s a serious financial product which, if used correctly, can be a saving grace for your family and dependants.

Types of Motor Insurance in India

Types of Motor Insurance in India: Motor insurance protects your vehicle against losses arising from unforeseen risks. It basically covers financial losses arising from accidents, theft and other natural calamities. Motor insurance is a contract for an automobile in which the insurance company agrees to pay for your financial loss resulting from a said specified event.

Types of Motor Insurance

1. Third Party Insurance
   This insurance is mandatory by law. It protects a policyholder against losses which arise due to bodily injury/death to a third party or any damage to property. Here the third party includes people travelling with you or whom the insured person injures and claims damages at the time of the accident. But this insurance does not protect you, your vehicle and co-passengers against losses which arise due to bodily injury/death.
2. Comprehensive Insurance 
   In addition to third-party coverage, this policy covers you, your car and co-passengers against damages /losses arising from unforeseen calamities, hence it is prudent to purchase this policy.

Why Motor Insurance

In India, nearly 4 lakh people meet with accidents every month. Fatalities in road accidents in India are moving up at a compounded annual rate of four percent. Considering the high number and the poor state of roads, Motor insurance is a necessary requirement. By law, Motor Insurance is mandatory. Motor Insurance provides financial cover not only to you but also covers damages to the third party (people travelling with you). Motor Insurance also protects you from losses arising from natural calamities like cyclone, earthquake etc.

1. Who should buy Motor Insurance?

Both individual owners, as well as corporate entities, should buy Motor Insurance. All vehicles, be it for personal or commercial use should be insured.

2. Is Motor Insurance Mandatory?

Motor insurance is mandatory for all vehicles under the provision of Motor Vehicles Act 1988, be it for commercial or personal use. It is compulsory to have a valid Motor insurance policy before you can start driving your vehicle. Motor insurance comes with unique plans for four-wheelers, two-wheelers and commercial vehicles.

3. What are the benefits of Motor Insurance?

It is a financial safety net that can help you offset the cost of

• Bodily injuries to yourself or others
• Lost wages due to injury
• Benefits to survivors when an accident results in death
• Lawsuits brought against you as the result of an accident
• Repairs made to your car due to damage caused in an accident

4. What is the cover level of Motor Insurance?

The cover level of Motor insurance can be the insured party, the insured vehicle, third parties (car and people). The premium of the insurance is dependent on certain parameters like gender, age, vehicle classification, etc.

5. What does Motor Insurance not cover?

Motor Insurance does not cover loss due to wear and tear, breakdown, accidents due to drunken driving and war perils. The insurance also does not cover failure or breakage when the vehicle is used outside the geographical area.

6. What is IDV?

IDV is the short form of Insured declared value. It is the value of Sum Assured that can be taken on your vehicle. It is calculated on the depreciated value of your vehicle or on the showroom price of the vehicle depending on the Insurance carrier

7. Why do premiums vary between different insurance companies?

Insurance companies work with different statistics and use different methods to calculate premiums. Some companies are specialized in certain areas or types and so are prepared to give discounts in those areas. This adds to the complexity as various companies yield varied prices.

8. What are the factors that determine the premium amount?

• Make and Model of the Vehicle
• Year of Manufacture
• Place of Registration
• Current Showroom price of the vehicle
• Whether Client is Individual or Corporate
• The principal insurance amount and its subsequent premium also vary according to the price of the vehicle.

9. What is Third Party?

The third party would include all people other than the primary insured. They would include people travelling in the vehicle or pedestrians or people involved in the accident.

10. Which type of policy is better and why?

A comprehensive motor loan is better, as it also covers you against losses arising from theft, natural calamities, vandalism etc. This will have a deductible attached to the policy.

Guidelines for Motor Insurance

Guidelines for Motor Insurance: The Insurance Regulatory and Development Authority (IRDA) has formulated guidelines that have to be adhered to, by any general insurance company offering motor insurance policies in India. Customers have to avail motor insurance policies only from companies registered with the IRDA. Motor insurance widely encompasses private car insurance, two-wheeler insurance, commercial vehicle insurance and all other types of road transport vehicles. In India, it is mandatory to own a motor insurance policy for any type of vehicle. This is because driving a vehicle without a valid insurance plan is a punishable offence as per the Motor Vehicles Act, 1988. A certificate of insurance will be issued apart from the policy by the insurer according to Rul,e 141 of Central Motor Vehicle Rules 1989 when a motor insurance policy is availed.

Types of Motor Insurance policies in India

Insurance companies across the country offer two types of motor insurance covers for vehicle owners -

a) Liability Only Policy - Third Party liability insurance is mandatory for all registered vehicles in India.

If a customer chooses a Liability Only Policy, then vehicle damages will not be covered by the insurer.

b) A Comprehensive Package Policy - Protection against damages to the vehicle plus the Liability Only Policy.

A Package Policy would offer a car owner wider coverage for their insured vehicles.

Coverage under any Motor Insurance policy in India

Damages occurring on any vehicle due to the following natural and manmade perils are covered -

Natural Disasters/Perils	Other types of perils
Fire	Theft / Burglary
Lightning	Housebreaking
Earthquakes Floods/Cyclones/Storms/Tempests/Hurricanes/ Frost / Hailstorm / Inundation	Explosion
Rockslides / Landslides	Self-Ignition
	Strikes / Riots / Terrorism/Malicious Acts
	While the vehicle is in transit through any means of transport
	Accidental External Sources

Exclusions under any Motor Insurance policy in India

A Motor Insurance policy taken from any insurer in India will come with certain exclusions and will not offer coverage for the following -

• Individuals driving without a valid driving license or under the influence of alcohol, drugs and other intoxicating drinks.
• If the accident has taken place outside the geographical area covered under the policy
• Mechanical or Electrical breakdowns in the vehicle and
• If the insured vehicle has been used for any unlawful reason.

Sum Insured for a Motor Insurance Policy

The sum insured is determined for Own Damage coverage as given below -

The insurance company will determine the sum insured according to the current value of the vehicle as per the manufacturer and the depreciation value depending on the age of the vehicle. Here, the sum insured is the value for which the vehicle has been insured and is known as the Insured Declared Value (IDV).

The sum insured is determined for Third Party coverage as given below

For third party coverage the sum insured is determined as per the Motor Vehicles Act, 1988 and also includes a mandatory personal accident cover for the car owner. The motor insurance policy can also be taken with inclusions like workmen�s compensation for the driver, personal accident coverage for co-passengers, etc.

Determination of Premium for a Motor Insurance Policy

There are multiple factors that affect a motor insurance policy premium in India. Different insurers charge different premiums for Own Damage cover. Customers must compare and choose a policy with an affordable premium. The premium will be higher if the customer opts for lower deductibles. Some of the common aspects considered to determine the premium amount for a customer is as follows - Vehicle class, Registration details along with the Engine number, chassis number, seating capacity, cubic capacity, fitness certificate, tax payment details, owner/driver details like gender, age, license validity, qualifications, insurance history, etc. The premium is calculated as per the prevailing rates in the city where the vehicle has been registered.

Premium for Own Damage coverage is decided by the insurance company after approvals from the Insurance Regulatory and Development Authority. Here, the premium will vary based on the following factors - Vehicle Age, Discounts offered by the insurer, loading, past claims, IDV, etc.

Premium for Third Party coverage is determined by the Insurance Regulatory and Development Authority. If there is any insurance breaks, then an inspection has to be conducted and additional charges have to be borne by the policyholder.

If existing motor insurance policyholders add CNG or LPG kits in their vehicles, then the (Road Transport Authority (RTA) office has to be informed to make changes in the registration certificate. The insurer also has to be intimated to include the extra premium that has to be paid for the CNG/LPG kit.

In order to lower their motor insurance premiums, customers can opt for No-Claim Bonus benefits and also get extra discounts for Own Damage and Third Party policies.

Own Damage Premium discounts can be got if -

• Customers are members of the Automobile Association of India,
• They own Vintage Cars as certified by the Vintage and Classic Car Club of India
• They install anti-theft devices in their vehicles as approved by ARAI - Automobile Research Association of India and the Automobile Association of India.
• Special concessions for modified vehicles for handicapped, blind and mentally challenged individuals.
• They choose additional voluntary deductibles or excesses.

For the Liability Only Section, insurers will give discounts on the reduction of Third Party Property Damage from Rs. 7.5 lakhs to Rs. 6,000.

No-Claim Bonus (NCB) in Motor Insurance

Policyholders can enjoy the No-Claim Bonus benefits just as the name suggests, when they have not made any claims for an entire policy year. As per current norms, the NCB varies from 20% for Own Damage premiums and increases to a maximum of up to 50%, if there are consecutive claim-free years. If the customer makes a claim, then the No-claim benefit is lost for the succeeding policy year. This NCB benefit is offered to the insured individual and not on the vehicle and hence cannot be transferred to the new owner when the vehicle is sold. Customers can transfer their No-claim benefits from one insurer to another during renewals by producing the adequate proof showing the entitlement of NCB.

Motor Insurance Policy Tenure in India

Any Motor insurance policy is generally valid for one year after which it has to be renewed by the due date. Grace periods are not offered on premium payments. If the policy is not renewed on time, then the insurer might conduct an inspection before renewing the policy. Additionally, if renewals are not done for more than 90 days for a comprehensive motor insurance policy, the customer might lose the No-Claim Bonus benefit from the insurer.

Top 10 Factors Affecting Life Insurance Premium Costs

Top 10 Factors Affecting Life Insurance Premium Costs: A great way to help and protect your loved ones, is with Life Insurance which can be a huge investment as well. A lower premium paid can yield to a good amount of savings over a period of few years. Life insurance premiums are based on a number of factors, and it can be quite tedious for a few people to understand why and what the charges are, and why they pay a rate that may not be the same as another. There are some factors that many insurance companies consider when pricing their policies, there factor may not be within your control. But the life choices you make, can also lead to the factors that can affect your Life Insurance premium.

The factors that affect your premium towards Life Insurance are:

1. Age: This is an obvious and not surprising factor that affects your Life Insurance premium, the age of the policyholder. If you�re young the rates will be lower in comparison to someone older. The possibility of a young individual contracting a life threatening disease or to pass away in their youth is very unlikely. The insurance companies believe that you�ll make many premium payments before they have to write a cheque for your family.
2. Gender: Insurance companies aren�t against gender equality, but they believe there is a different life expectancy for different genders. As per the studies and statistical findings, women are believed to live 5 years more than men at the minimum. Therefore affecting the premium they pay, making them pay the premium for a larger period of time but at lower rate which is a plus point for the women.
3. Smoking: Smoking puts the policyholders at higher risk of all ailments, so if you�re a smoker that that�s as good as raising a red flag to the insurance companies. Most smokers pay a premium twice as much as non - smoker does, thus affecting the premium to a huge extent.
4. Medical history: There�s isn�t much one can do with the gene pool they come from. If a policyholder has a medical history of serious illnesses like cancer, heart diseases, or any other, then that makes them susceptible to get these from a hereditary perspective. Which increases the individual�s premium by a larger margin than if their gene pool wasn�t.
5. Health records: You as the policyholder will also need to provide your own health records. These records will ensure that you don�t have any chronic diseases or potential health issues and keep your premium also in check instead of making a difference to it.
6. Drinking: Drinking of alcohol is injurious to health in more ways than one. If you as the policyholder are a heavy consumer of alcohol this can affect your premium at higher insurance rates. Insurance companies ensure to ask the applicant if they are smokers or drinkers.
7. The Policy: The policy itself also affects the premium you pay, the longer the tenure of the policy the larger the amount of the benefit at the time of death, since you�re paying it for that period of time. Short term policies are more expensive that long term.
8. Profession: Your profession also plays an important role in the premium you end up paying, any policyholder working in the mining industry, oil and gas, fisheries or any other dangerous profession increases the premium amounts you pay for the policy you decide to take.
9. Lifestyles choices: Many insurers have a higher premium for people who love to takes risks for the thrill of it. Like speeding cars, climbing treacherous mountains or other high risk activities. Thereby increasing your premium to substantially more than other.
10. Obesity: Obesity is another factor that affects your premium as a policyholder, being obese can lead to a number of health problems like Osteoarthritis, High Blood Pressure, Cancer, Stroke, Coronary Heart Disease, causing overall health problems in the future and also increases your rates.

How these factors affect your rates of premium is dependent on the insurance company and the way they treat these factors and the combination of them. For example: having a history of cancer in your family and still being a smoker can affect your rate in more than one way or being obese and having a history of heart disease also affects your rates of premium. Every insurance policy is based on each individual and premiums are calculated on the insurance company's rules of rating.