5 benefits of tailor-made insurance-investment plans

A life insurance investment has become a basic necessity of your life. Life insurance policies can cover you financially against unannounced contingencies like death, critical illness, loss of income, and physical disability. Although it might offer comprehensive coverage, you might want to cover only specific requirements based on your financial needs.

Many insurance companies can provide a tailor-made insurance plan that can suit your needs. Typically, the tailor-made insurance schemes can cover those risks, which are usually ignored by your insurers. When you invest in a tailor-made life insurance plan, you can receive coverage for vector-borne diseases, travel-related accidents, and so on. Since tailor-made policies can secure you during unfortunate events, let’s go through each type of investment plans and their benefits in detail:

  1. Customized insurance plans

A customized insurance plan can allow you to cover the risks, which are usually not covered under other life insurance policies. Under customized insurance plans, you can avail a host of covers such as musical instruments, wedding dresses, helmets, CCTVs, etc.

The following are the benefits of customized insurance plans that are mentioned below:

  • It primarily focuses on covering the smallest risk by providing insurance coverage.
  • It can penetrate at a large scale in the insurance market since it offers coverage based on your financial requirements.

  1. Term insurance plans

Every individual can purchase a term insurance plan to secure the financial needs of the family. However, it can be challenging for a self-employed individual with relatively low income or without any income proof to buy term insurance. Such people require a term coverage since they are categorised under high-risk takers. If you fall under this category, you can purchase term insurance under the ‘affinity group.’ However, you can be a part of the affinity group only if you have commonality other than employment.

The benefits offered under tailor-made term insurance can be as follows:

  • It can cover all the people who are a part of the affinity group. Since the coverage depends on the customer-profile, your insurance company can charge a high premium amount.

  1. Sachet insurance plans

Sachet insurance or bite-sized insurance are those plans, which offer low premium as well as low coverage. The primary objective of satchet insurance can be to focus on life and general categories such as travel, health, and lifestyle needs. Typically, it can target a particular risk, which attracts many first-time buyers towards it.

Under sachet or bite-sized insurance plan, you can receive the following benefits mentioned below:

  • You can receive insurance coverage for a specific risk. For instance, you can buy sachet insurance to cover a specific health condition for a short duration.
  • You can obtain financial aid for vector-borne diseases like dengue, malaria, etc.

  1. Microinsurance

The demand for microinsurance has been rapidly growing in India. Additionally, it can enhance the penetration of the insurance sector in our country. According to a recent report, the insurance sector can massively grow to $280 during the on-going financial year of 2020. Today, micro insurance has been successful in many third-world countries such as China, Brazil, and South Africa. It can allow low-income households to afford insurance coverage, especially health insurance.

When you buy micro insurance, you can receive the following benefits given below:

  • It might offer a sum assured amount of Rs. 50,000 or below.
  • It can financially protect the low-income groups of the country who might be unable to manage their financial needs in the absence of the breadwinner.
  • It can offer insurance coverage at an affordable rate to all rural households.

  1. Group insurance plan

A group insurance plan can cover those people collectively who come under one roof with a commonality of purpose or share common economic activities. It can be beneficial for groups that come under the following categories:

  • Employer-employee group
  • Alumni group
  • Savings account holders
  • Housing societies
  • Social and cultural associations

Typically, you can receive the following benefits under group insurance plans:

  • You can receive a low premium depending on the number of members covered under group insurance plans. The higher the number of the groups, the lower the amount of premium.
  • You can receive maternity as well as new-born baby coverage.
  • Your insurance company can waive the waiting period for pre-existing diseases. Moreover, you can opt for coverage for senior citizens.

To conclude, there are multiple life insurance investment products in the market available today. As a buyer, you should not be overwhelmed with the types of investment plans while selecting one for yourself. As a policyholder, you can not only choose a plan based on your financial goals but also customize it based on your preferences.