Insurance : How much at what age

[ar2st]

At every stage of life, there is an element of risk for the individual.For instance, if you are married and have children, an untimely deathor accident is going to cause serious financial loss to your family.

Adequate insurance cover is, therefore, advocated by all financialplanners to make sure that your family does not go through anyfinancial hardships.

However, while it is important that you have enough insurance, too muchof it is also bad. This is because insurance, as a product, does notgive you great returns. So, you need to have a proper mix of insuranceand investment to meet all your financial goals. Let us look atdifferent life stages and what are the elements that you need coverfor:

From birth till end of education
There is actually no need to have any life cover as the individual'sability to earn any income is nil. In case of an untimely death, theparents are more bereaved because of the loss of a child, and less onthe account of any financial loss. Of course, the entire family shouldhave a family floater which covers the child as well.

Single without dependents
Once you start working, the need for insurance does become important.If you are someone who does not have any dependents, then you can optfor medical cover and life insurance, in the form of term insuranceand/or personal accident insurance. Since buying an insurance cover atan early age is cheaper, it makes sense to go ahead and buy it as earlyas possible.

Recommended:
Life insurance - term cover and/or personal accident insurance
Health insurance (mediclaim)

Single person with dependents
However, if you have dependents, especially old parents, it is bestthat you take more cover. If there are more people dependent on yourincome, you should take more life insurance. This need may rise tocover medical bills, outstanding debts, caretaker expenses for thesurviving dependents, and education costs for surviving children


Life insurance - term cover and/or personal accident insurance
Health insurance (mediclaim)

Couples with no children
In case only one spouse is earning, it is important to have good coverfor him/her. This ensures that the dependent does not have anyfinancial bottlenecks due to an accident or unfortunate death of thebread earner. Also, if both the spouses are working, it is important tohave adequate cover for both the members. The need for insurance mayespecially arise for medical bills and outstanding debts, if any.

Recommended:
Life insurance - term cover
Motor/motor cycle insurance
Health insurance (mediclaim) for self and spouse
Overseas medical claim - as required (for all categories)
Personal accident insurance for self and spouse

Couples with children
If both the spouses are earning members, it is possible that if one ofthem were to expire, the other may be able to cope financially onhis/her's remaining income. However, in case there are joint loans andother obligations, then it is imperative to have a strong insurancebackup. If you have acquired a house by now you should also be lookingat fire and burglary covers.

Recommended:
Life insurance - term cover
Motor insurance
Health insurance (mediclaim) for family
Household insurance
Personal accident insurance for self and spouse
Building insurance, including fire and burglary
Increased term cover for the home loan

Older couple
As you grow older, the need for insurance increases. You would be moreprone to falling ill, thereby increasing the burden on your funds.Also, if you are looking for a retirement home, you will need to insureit that against all kinds of dangers.

Recommended:
Life insurance
Motor insurance
Health insurance (Mediclaim) for family
Household insurance
Personal accident insurance for self and spouse

Retired couple
Besides a retirement corpus, this is the time you need insurance most.Incidents of illness, possibility of critical illness and deathincreases exponentially during this last stage. So, it is best that youare well covered to hedge against any risk.

Recommended:
Motor insurance
Health insurance (Mediclaim) for family
Personal accident insurance for self and spouse
To conclude, the above is a basic guide to the covers you require.However, this will keep on changing with the profile of the person. Butyou need to remember that your liabilities like credit cardoutstanding, home loan and other debt should be over by the time youreach the retirement period. This will help you to have a debt-freeretirement.