Making Money - Page 2 - WCafe Financial Services Pvt Ltd

Importance of Travel Insurance post COVID

Not many people realize this but travel-related insurance is easily one of the most ignored aspects of international travel and with the entire COVID-19 scenario running roughshod on international travel, it will become all the more important. This kind of insurance has always been essential to cover travel-related risks like missed connecting flights, lost baggage, injury or illness abroad, loss of travel documents, loss or damages caused by weather-related problems, etc. With the evolving Corona Virus situation, however, things will continue to remain exceptionally unpredictable for the foreseeable future, leading to any factors which will lead to increased need and importance of insurance for travel purposes.

Factor 1: The lingering risk of Corona Virus infection:

There will be a few long months, maybe more than a year, before you can expect an effective vaccine for coronavirus infection. News shows that while some medicines have shown promising preliminary results in the treatment of Covid-19, a vaccine is always the best choice because it is a preventive measure and as the old adage goes, prevention is always better than a cure. International travel takes place in planes which are enclosed environments and people are too close for comfort in the planes. Did you know that even if you fly business class, you are still not far enough from other people in a plane for sensible social distancing to be possible? Imagine flying a coach in such a scenario! This means that travel insurance is going to be extremely necessary for everyone.

Factor 2: Airlines services will continue to be shaky

Airlines are trying very hard across the globe to keep their systems operational but the situation was so bad that they were not even able to find enough parking spaces for all the grounded planes. The fact of the matter is that airlines always run at paper-thin margins because of the highly competitive industry and extremely volatile cost structure. Once they are going to get things in the air once more, there will be a lot of turbulence. Many systems were working by duct tape and hammer blows and getting back these systems to operational level in an understaffed and risk-bearing situation will mean many people will miss connections, luggage will get lost many times and all such risks will be very high, creating a strong need for everyone to buy travel insurance online before they fly to anywhere out of the country.

Factor 3: You might get stuck out of India during lock-down

Let there be an assumption that you were able to travel to any country out of India and you landed there all safe and sound, but just before you were supposed to travel back, your host area encountered a sudden rise in infections, making it necessary for the government of that area to suspend all travel activities in and out. In such a situation, you will be stuck in your host country until the government of India can arrange for your return. Travel insurance will be your only help in such a case. It will cover all the extra expenses which you will have to bear during the lockdown.

All things said and done, in the coming few months, international travel will change like never before.

What is travel insurance ?

With the increase in travel, one of the important things that travellers need to know about is Travel Insurance. This form of insurance helps cover a whole range of uncertainties and scenarios that can drain out a traveller’s finances. Most countries require mandatory Travel Insurance while applying for a visa. But choosing the right Travel Insurance which covers all the risks of travel is important.

What does Travel Insurance mean?

Travel Insurance is a type of insurance that covers different risks while travelling. It covers medical expenses, lost luggage, flight cancellations, and other losses that a traveller can incur while travelling.

Travel Insurance is usually taken from the day of travel till the time the traveller reaches back to India. Taking Travel Insurance ensures comprehensive coverage in case of any emergency in another country. Travel Insurance is also available for trips taken in the home country of the traveller like Bharat Bhraman & E-Travel, but it is a more popular option for travel abroad.

Some of the risks covered under Travel Insurance are:

Personal Accident Cover, which covers:
- Insured’s Death
- Permanent Total Disability

Accident & sickness medical expense reimbursement
Dental treatment relief
Emergency evacuation
Repatriation of remains in case of death
Baggage delay
Loss of checked baggage
Loss of passport
Flight delay
Hijack
Home burglary
Trip curtailment
Trip cancellation
Missed connection/missed departure
Bounced hotel/airline booking.

There may be more risks covered under individual policies depending on the requirements of the traveller. The amounts to which these risks are covered depends on the policy & plan that the traveller opts for. Travel Insurance also covers additional risks at an additional premium. Some of these risks are specific to the traveller or the place the person is travelling to.

Types of Travel Insurance:

There are single trip Travel Insurance policies meant for one journey. But for frequent travellers who travel abroad for business purposes, there is an option to buy a multi-trip Travel Insurance policy. Some policies last for an entire year and cover multiple trips to a particular destination. Opting for such policies is much more cost-effective for businessmen and frequent travellers to a particular destination. We also have student policies which are specially designed for students going abroad for studies at an affordable premium. The maximum trip length can last from 30, 45 and 60 days.

Another type of travel policy is a Group Travel Insurance policy. A group policy covers 7 or more travellers. These policies are cost-effective and offer similar benefits as single trip Travel Insurance policies. Group Travel Insurance policies are based on the age of the travellers which means it works out more cost-effective per traveller. Most travel companies opt for group Travel Insurance policies when they take groups across different countries on tours.

It is easy to pick out a policy once you know the Travel Insurance definition. While planning your trip abroad, pick out a Travel Insurance policy that provides exhaustive coverage with high coverage. It is possible to check the cost of Travel Insurance on insurance aggregators and pick out the best policy. HDFC Bank offers a variety of Travel Insurance policies through the bank’s website like Student Travel Insurance, Domestic, Senior Citizens, Family and even Individual Travel Insurance. You can easily pick out a policy that suits your need and provides the best value for money.

Income Tax / Insurance / Investments / Making Money / Money tips - 03/20/2020

How is interest computed on your credit cards dues?

Finance charges or interest charges are the credit card interest rate. It is the rate charged by credit card issuers on the borrowed amount. However, the interest charges are applicable only to those cardholders who don’t pay their outstanding in full.

For instance, if your credit card bill amount for a previous billing cycle is Rs.10,000 and you wish you make a partial payment, either minimum amount due (MAD) or even lesser than that, then the bank will levy finance charges as per its policy.

Hence, even where you make the minimum amount due on your credit card - interest will be charged to you as you have not paid back the full amount.

The good thing about using credit cards is that if you clear the entire outstanding on the card before the due date, you won’t be charged any interest. But if you’re someone who wishes to clear the dues at your own pace, you must know how much interest your bank charges, how it’s calculated and all other related information.

How Are Credit Card Interest Rates Calculated?

Credit card interest rate is calculated as the Annual Percentage Rate (APR) of charge. It is the interest rate for the whole year rather than a monthly rate. However, while calculating the interest rate for monthly dues, the monthly percentage rate (MPR) will be applied to the transactions. The APR and MPR vary from one bank to another and one card to another. While applying for a credit card, it’s important to know how much APR is being charged on a particular card.

What is Interest-Free Period of a credit card?

It is called the grace period, during which the balances on credit card do not attract finance charges provided the credit card holder repays the entire outstanding amount in full with the monthly credit card bill. The grace period varies with every credit card and usually is between 20 to 60 days. It is also called the interest free period.

For example, the Credit Card you hold has an interest-free credit period of 50 days. So, a credit card holder whose billing date falls on 15th of the month can spend on her/his credit card from 15th January to 14th February, and her/his bill will be generated on 15th February. Her/his payment due date will be 3rd March. Therefore a purchase made on 24th January will have a credit period of 40 days, while a purchase made on 10th February will have a credit period of 24 days.

Additional Charges other than the Finance Charges

Late Payment Charges - If the MAD is not paid up to the due date, the late payment charges are levied. Late Payment charges are generally a fixed amount for the range of outstanding amount. It could vary from INR 500 to INR 1000 (depending on the credit card you hold).
Over Limit Charges - If the total outstanding amount in a particular month exceeds the credit limit of the card, over limit charges can be a % of the overdrawn amount or a fixed fee (depending on the credit card you hold.)

When will interest be charged on your credit cards?

As mentioned earlier, if you pay the total amount due (TAD) on your credit card before the due date, the interest charges will not be applied. Let’s see the cases when the interest will be levied on your credit card transactions.

Case 1 - When you don’t pay the outstanding amount by the due date - You have to pay interest for the days the amount is outstanding and no payment has been made by you.

Case 2 - When you take a cash advance (cash withdrawal using a credit card) - If you withdraw cash using your credit card, you are availing the cash advance facility, hence, the withdrawn amount will attract finance charges from the date of withdrawal till the amount is paid back in full. There is no credit period/grace period for cash withdrawal. Interest on such cash withdrawal could be levied at anything between 2%-4% a month.

Case 3 - When you pay less than the Minimum Amount Due (MAD) on your credit card - If you wish to pay an amount that is less than your minimum amount due on your credit card, the entire outstanding amount will attract finance charges along with all the new transactions, till the previous outstanding amount is cleared in full. Additional late payment charges are levied.

Case 4 - When you carry forward any outstanding balance from the previous period to the next cycle - If you haven’t cleared your previous month’s outstanding in full, the bank will carry forward the remaining amount to the next billing cycle. In such cases, based on the repayment amount, either MAD or less than MAD, the interest rate will be charged on the outstanding as well as on all the new transactions, till the previous dues are cleared completely.

It is very important to know that interest on credit cards is charged from the date of the purchase till the date of payment and not from the due date of the credit card.
Interest is charged on whatever amount is pending after the due date - whether it is as small as INR 50 - hence, you must pay your credit card debt always in full.
You will get a credit period of 40-45 days for every purchase but if you do not make full payment, interest will be levied from the date of purchase.
Payment made is first adjusted towards interest, penalty and other charges and then it is adjusted towards the principal amount.

We have tabulated below an example of how interest is computed on your credit cards.

Calculation of Interest & other charges on a Credit Card (@wealth Café working)

Period	Transaction	Amount (Rs.)	Amount (Rs.)
January	Purchase made on 10 January 2019	5,000

	Total amount due on a statement dated 15 January 2019		5,000
	Minimum amount due on a statement dated 15 January 2019 (MAD is typically 5% of the TAD)		250

	Payment due date – 3 February 2019 (no payment was made)		-

February	Purchase made on 7 February 2019	2,000
	Purchase made on 10 February 2019	5,000

	On the next statement dated 15 February 2019, interest charges will be levied as follows
	Interest on Rs.5000 for 35 days (from 10th January to 15th February)	201
	Interest on Rs.1,000 for 9 days (from 7th February to 15th February)	21
	Interest on Rs.500 for 6 days (from 10th February to 15th February)	35
	Penalty Charges for the default in the month of January (not paying Minimum amount due)	500

	Total Amount due on a statement dated 15 February 2019		12,757
	Minimum Amount due on a statement dated 15 February 2019		638

	Payment due date - 3 March 2019 (partial payment was made)		5,000
	*this payment will not be mapped against the purchases of Jan directly but will first be adjusted against interest

March	Purchases made on 25 February 2019	2,000
	Purchases made on 5 March 2019	3,000

	On the next statement dated 15 March 2019, interest charges will be as follows
	Interest on 7757 for 28 days (from 15 February to 15 March)	250
	Interest on Rs. 2000 for 18 days (from 25 February to 15 March)	41
	Interest on Rs 1000 for 10 days (from 5 March to 15 March)	35

	Total Amount due on a statement dated 15 March 2019		13,082
	Minimum Amount due on a statement dated 15 March 2019		654

	Payment due date - 3 April 2019 (full payment was made)		13,082

Hence, the best way to deal with a credit card is to always pay your credit card dues on time. If you are stuck in a credit card debt, please understand the annual interest rate that you are paying on your CC.

Credit cards can be very beneficial when there is an immediate liquidity crunch and you have to pay your bills. The reward points are also good with your credit cards. However, the interest and penalty cycle is very vicious. So pay your dues on time, set reminders and make the most of your credit cards.

Wealth Cafe Actionable - Where you are stuck in a credit card debt and are unable to get out of it, take a personal loan which is way cheaper (interest rate is around 11% on your personal loan). Where you know you will repay in a month or 2, you can opt for a balance transfer from the existing credit card to a new credit card. It is important to know that such balance transfer also levies interest rates but they give a grace period of 30 - 60 days. Also, both these options will levy processing charges, hence do your calculations of what is the best way to get out of debt and work on it.

You must first clear your credit card debt. No return on any investment will be able to match the interest expense of a credit card. Hence, it is more important to pay off your debt first.

Making Money - 06/11/2019

How to negotiate like a boss?

As a freelancer or a business owner or someone applying for a job or even buying vegetables, we all have to deal with negotiating the fees/ rates/ salary with strangers. Being raised as a humble middle-class kid, I wasn’t too comfortable asking for money from other people at first. But when you have to pay the bills and own your responsibility to fulfill your dreams, this is the no. 1 trait everyone must learn in order to get success.

After negotiating a salary with 3 employers when I started my private practice 7 years back it wasn’t easy for me to go out and scout for work. After doing some small certification assignments for one year, I was presented with an opportunity with an MNC company for some work across their different plants. At that time I was desperate for work and was ready to get the assignment for peanuts. But I held myself high and discussed synergies I could bring to my client and successfully got the assignment for about INR 700,000. The confidence I got from that assignment helps me today as well, to send out proposals to my client. Here are the steps I personally used to quote the fees and negotiate like a boss:

Research your potential client
Know your worth/ cost
Leave a room for discussion/ negotiation
Be flexible
Know your bottom price

Research your potential client

When you get a request for proposal, ask details from your potential client about their requirement. Know your clients, their backgrounds, the specifications of the job, their budgets, the timelines for deliverables, the quality standards required for the project. I know you may not guess all these variables at first and you get better with practice. Some companies ask quotes from multiple vendors. The final decision to choose among various quotes is not always the lowest fee, they do a trade-off between best quality services with the lowest fees. Your job is to identify the qualities they appreciate is covered in your proposal and they will be willing to pay a higher price for the quality.

Know your worth/ cost

Now that you know the specifications from your clients, estimate the time cost/ material costs you will need to incur in order to deliver your product/ service to your potential client. For example, when I give a fee proposal to a client and I know that the assignment is hard pressed for the deadline and the time available to complete the assignment is very limited, I factor the additional hours I will have to spend beyond the usual business hour to finish my deliverable on the due date. I will give exclusivity as quality to my client for the period of the assignment. Many clients would love to pay a higher price if they know you work exclusively for their assignment.

Leave a room for negotiation

While communicating your price, if you sound rigid to your client and give a fees quote – take it or leave it, this will not give a good experience to your potential client and they may not even consider you for any future engagements. Hence, always leave some room for negotiation and quote a price a little higher than you would be okay to work with. When your client asks you to lower your fees or give you counter fees, you know you have the room to accommodate their wishes and not press your quality of work. Be very confident when telling your fees to your clients and don’t ever forget to add the points why your services score an edge on quality.

Think Long-term

While discussing the fees, always remember your potential clients will be your potential marketers. One assignment can be a gateway of your recurring assignments with the Company or future potential referrals from the Company. Be willing to accommodate if they have any special requests. Think long term client relationships than short term wins.

Know your bottom price

While you know your price and give a higher quote, sometimes a client will come back and ask for more than 50% reduction in your proposed fees. That’s when it is best for you to know your bottom price beyond which it is okay for you to leave the assignment. This will help you to identify the kind of clients you would want to work with. It is always good to say NO to a client if they don’t value your services and the price. This will help you create a brand for your business and also find the clients who would love your services and the value you provide to them. NEVER BE DESPERATE.

WC Actionable: I would like to give you one BONUS step while negotiating is TO BE CONFIDENT in your communications. If you are confident in yourself, the client will gauge that you can deliver the value that you are promising. Confidence is the differentiator that will get you the price that you wanted to charge and not the price your client wants to pay. Hope the above points help you in adding value to you and your potential clients. Would love to hear about your experiences.

PS - This is a guest post by CA Sonia Dawar, who is a fe-money-ist and is a practicing chartered accountant with over 8 years of experience. Negotiation and discussing fees is a part of her everyday assignment. She has taken charge of her money for herself, her family and her business. Looking forward to more insightful posts from her.

Making Money - 05/28/2019

5 ways to get your invoices paid faster

As a freelancer, small business owner if you are unable to recover your dues from your clients, we have listed ways which will help you recover your payments due.

Apart from getting an MSME (Micro, small and medium enterprises) registration under the MSMED Act, 2006. The below mentioned 5 ways should help you present your brand and business as a well organized professionally run setup which your clients cannot take for granted:

Get a personalized Email account

We checked profiles of many freelancers/small business owners on Instagram and found most of them using their personal Gmail accounts. Sending a word invoice from your personal Gmail accounts doesn’t put across the best face for your brand/business. Purchasing an email account (YOUR NAME@YOUR BUSINESS/BRAND.COM) would cost you around INR 1,500 per year which is a real investment to your business.

Have a Signed agreement

When you are discussing a potential engagement with your client, discuss clearly the scope of your engagement, the fees and the timelines for delivery of your work and the payment terms. Put all these points in a one-pager agreement and let your client sign and give you a copy of this.

If you are currently doing this by setting out your terms on an email, putting this on an agreement and getting your clients to sign the terms makes it more professional and something your client knows he has signed upon. If you are worried about the turnaround time of getting assigned application, use online tools like DocuSign to get your agreements signed instantly.

Complete your Vendor Onboarding

Before you start the work and while signing your agreement, ask your client to finish the vendor onboarding for you. Big companies generally follow a detailed vendor onboarding process and this may take anywhere from a week to a month to get you onboard as their vendor so that they can pay you once you send them your invoice. Get this done right away so that by the time you are done with your deliverables, your invoice can be sent directly for processing.

Raise invoices using an invoicing tool

I bet many of you must be sending an invoice in excel or word to your clients. How about sending a professional looking invoice which goes directly from an application as an email to your clients with your branding? Cool, isn't it? We use and recommend Quickbooks application for raising your invoices. This is a cloud-based accounting application which you can access from your phone, tab and computer system. It comes at an annual cost of INR 5,000 and the Company keeps running some discount offers all the time.

If you are looking for a free application to use, you should consider Genie books. It is free for users with a turnover of up to INR 1.50 crores. When you raise an invoice, always mention the due date in the invoice itself as per your terms of the agreement.

Review your invoices and follow up diligently

The above accounting applications (Quickbooks and Genie books) gives you a dashboard look for your business. You can check invoices sent, whether your clients have viewed the invoice you had sent them and invoices past their due date. Isn’t it great! Review the dashboard at least weekly and take necessary TIMELY follow up actions like a boss!

Making Money - 05/16/2019

Income Tax Rate FY 2016 - 17 (AY 2017-18)

What is Income Tax Slab?

Income tax is that percentage of income paid to the government by the taxpayers for the betterment of the public at large. This income is categorized into different groups on the basis of the amount of income. Each such group is known as a Tax Slab. Tax is charged at different rates on the range of income falling under different income tax slabs.

The Income Tax Act 1961 is the law that governs the provisions for our income tax.

The income tax rates are usually revised every year during the budget. Various deductions that are allowed to a taxpayer under Section 80C, Section 80D etc.

Income Tax Slab Rate

Following are the income tax slab rates and deductions for different categories of tax payers:

For Individuals Below 60 Years Of Age

Income Level	Tax Rate
Rs. 2,50,000	Nil
Rs. 2,50,001 - Rs. 500,000	10%
Rs. 500,001 - Rs. 10,00,000	20%
Above Rs. 10,00,000	30%

For Senior Citizens (Age 60 years or more but less than 80 years)

Income Level	Tax Rate
Upto Rs. 3,00,000	Nil
Rs. 3,00,001 - Rs. 500,000	10%
Rs. 500,001 - Rs. 10,00,000	20%
Above Rs. 10,00,000	30%

For Senior Citizens (Age 80 years or more)

Income Level	Tax Rate
Upto Rs. 5,00,000	Nil
Rs. 500,001 - Rs. 10,00,000	20%
Above Rs. 10,00,000	30%

Surcharge @ 15% of tax will be payable by individuals having total income exceeding Rs. 100,00,000.

Income Tax Deductions and Exemptions

Income Tax Section	Gross Annual Salary	How Much Tax Can You Save?	HDFC Standard Life Plans
Sec. 80C	Across all income slabs	Upto Rs. 46,350/-saved on investment of Rs. 1,50,000/-	All our Life Insurance Plans Buy Life Insurance and Save Tax
Sec. 80CCC	Across all income slabs	Upto Rs.30,900/-saved on Investment of Rs.1,50,000/-	All our Pension Plans Buy Pension Plans and Save Tax
Sec. 80 D*	Across all income slabs	Upto Rs. 10,815/-saved on investment of Rs.35,000/- (Inclusive of Rs. 20,000/- towards health insurance of parents who are senior citizens)	All our Health Insurance Plans All the health insurance riders available with our Conventional Plans Buy Health Insurance and Save Tax
Total Savings Possible **	Rs. 57,165/- Rs. 46,350/- under Sec. 80C and Sec. 80CCC and Rs. 10,815/- under Sec. 80D Above figures calculated for an individual with gross annual income exceeding Rs. 10,00,000/-
Sec. 10 (10)D	Under Sec. 10(10D), the benefits received by you are completely tax-free, subject to conditions specified therein

Disclaimer: – The articles are for information purposes only. Information presented is general information that does not take into account your individual circumstances, financial situation, or needs, nor does it present a personalized recommendation to you. You must consult a financial advisor who understands your specific circumstances and situation before taking an investment decision.

Income Tax / Insurance / Investments / Making Money / Uncategorized - 03/05/2019

10 things to note before buying a Term Insurance

Term Insurance is a financial product that each of us must-have. It is a cost-effective financial product that covers the risk of our financial life. It is a very simple product, you pay premiums per annum and your life is insured, on your death within the term of the insurance and on regular payments of premium, your financial depends would get the sum assured amount. The cost i.e. premiums is not very high where the insurance is taken at an early age and in good health. Irrespective, term insurance premium amounts are very low as compared to other insurance products. However, there are times when in spite of taking term insurance, the sum assured i.e. the cover amount is not sufficient, the tenure of the insurance is less, incorrect details are provided due to which claim is rejected etc. In such situations, in spite of paying for an insurance product, your life is not insured enough. Hence, it is very important that you buy the right insurance product. I have listed below 10 things that you must keep in mind before buying term insurance.

1. Amount of cover: It is very important to have a cover of an adequate amount based on your respective situation. If the cover is less, owning insurance will not serve the purpose. We have discussed in detail the adequate amount of term insurance cover in our Article How much term insurance cover is enough. If you want a basic formula, then a cover of 10 to 12 times your annual income should be fine. It is better to put in the extra 10 minutes and read our detailed article before you finalize term insurance cover.

Refer to our Article http://www.wealthcafe.in/how-much-cover-is-required-for-term-insurance/

2. Buy the term insurance policy till your retirement age: There was a time when I felt if term insurance is for my life, then why is there a need for tenure, it should be available till the age of 100. However, that is not the case. General term insurance is for a maximum period of 40 years. Accordingly, if start a policy at 25, you are insuring your life till the age of 65 and if you die after 65, no money shall be received by your financial dependents. However, will you have any financial dependents post you retire? The fact that you have retired means you have enough to take care of any financial dependents that might be then? Term Insurance is generally bought for a period until you retire. There are a few insurance companies who are giving insurance for 99+ years. Please do a cost-benefit analysis before finalizing the same.

3. The premium of the term plan never increases: The earlier you buy term insurance, the cheaper it will be. The life insurance companies calculate your premium depending on your health, responsibilities, income and other factors. Given that at a young age, one has lesser medical issues, the term insurance premium is less. If you continue to pay your premium regularly and not cancel your term plan, your premium at the age of 40 would be the same as it was at the age of 25 (when you bought the term insurance in the first place).

4. You should avoid delayed premium payments: You should avoid delaying your premium amounts as that would lead to levy of penalty charges from the insurance companies. A delayed premium payment generally does not lead to a lapse of term insurance. However, it is important to know the grace period available for your term insurance to avoid any unforeseen errors. If you delay posting the grace period as well, there is a chance that the term insurance may lapse.

5. Do not skip your premium amounts: If you miss the grace period for the premium payments, your term insurance will lapse. Even where you have been regularly paying your premium for 10 years and skipped paying for the 11th year and your grace period of the premium payment has also lapsed, and then your term insurance will lapse. After a certain age, it is very difficult to get a new term insurance. Even if you do, the premium amount would be too high. Hence, you should always pay your premium amounts and never let the insurance policy lapse.

6. Do not rely on Tele-medical examination i.e. Take MEDICAL TESTS You should go for proper medical tests as this will reduce any chances of the claim being denied in the future (on medical grounds), especially since you have disclosed all facts. It is better to pay an additional premium for a small health condition (say obesity) rather than the family facing problems with the claim on the grounds that all facts were not disclosed. Some people go for medical tests over the telephone, to avoid the hassles of a medical test. However, this thing may cost your family the coverage amount.

7. Don’t buy term insurance with RIDERS: Never combine your term insurance with any riders or additional covers such as accidental death or disability arising from accidents etc. These are available separately on a standalone basis from the general insurance providers. They would be cheaper and better if bought separately. The insurance provider may sell money back cover with your term plan to lure you by saying you won't get anything back in a term plan. Please do not fall for the same. Term plan is to ensure your life, your family will get a good amount of money if anything was to happen to you and that is what matters.

8. Buy the insurance product ONLINE: Term insurance is the easiest to buy online directly from the insurance companies website. It hardly takes 10 minutes to fill all your details and then upload the scan copy of your documents online. If anything is missing, you receive an email with the requirements and you have to submit the same to the insurance company. On receipt of the same, they schedule your medical tests post which you receive your insurance document. When you are buying it online yourself, it is cheaper, easier and accurate and thus, the chances of negligent errors are a bare minimum.

9. Review your life insurance cover every 5 years: The cover amount requirement that you would have calculated at age of 30 when you first bought your term insurance may not be the same when you are 40. As you grow older, your financial responsibility increases along with the increase in your income and investments. Thus, it is important to review your cover amount and your overall insurance needs every 5 years.

10. Disclose EVERYTHING: Tell the insurance company if you smoke or drink. Do not hide these facts just to save on the extra premiums. You are actually breaching the contract with the company and almost always your claim will be rejected at the end. Disclose all the information correctly in your policy forms and verify it properly before submitting the same. Do not rely on your agents to fill your forms correctly. Inform about all the health problems that you are facing currently or in the past, family health history and any other information with respect to your health correctly. The above-mentioned list of things may seem very exhaustive but it is not very difficult to follow the same while buying your term insurance. Many people keep pushing their purchase of term insurance, thinking they have a lot of time to buy one. One of the most important things that you can do to secure yourself and your financial dependents is buying a term insurance plan at an earliest.

To learn more - you can check our course - NM 102: Build a Safety Net. Use code SAVE20 for 20% off.

Insurance / Making Money - 11/27/2018

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