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You Can Propose Another Person If First Nominee In Life Insurance Policy Dies, Add Riders To Boost Protection

Adding riders like accidental death, disability benefit, premium waiver, etc., will enhance the coverage and provide additional benefits to beneficiaries in case of a major setback to the policyholder.

May 14, 2024
May 14, 2024
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Q1. I am a 40-year-old professional who recently lost my job due to company downsizing. While I have life insurance to secure my family, I am worried about paying my insurance premiums due to job loss. Does life insurance provide any benefits if one loses a job?

Ans. In a financial turmoil scenario, you can change premium payment frequency or wait to pay premiums till the end of the grace period and keep the policy in force. If you cannot pay premiums for the long term, you can convert the policy to paid-up and continue with proportionate benefits. You can renew the policy with full benefits when you pay the premiums. These provisions vary by policy and insurer, so reviewing your policy documents or contacting your insurer to understand the options available is essential.

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Q2. I am 35 years old and am thinking about changing the tenure of my term life insurance from 15 to 25 or more years to provide longer financial security to my family, as I now realise that I will be an earning member for another 25 years. Will my present insurer allow that? Will it entail an increase in the premium?

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Ans. Term life insurance typically doesn’t allow extending the policy tenure as the premium is dependent on the cover term in addition to other risk parameters. However, you can choose to avail of a new term policy with an increasing sum assured option for the desired policy term to ensure minimal overlap and manage premium outgo as per your current age.

Q3. I want to change the nomination in my life insurance policy. Earlier, my mother was the nominee, but she passed away last month. I want to make my son the nominee now. Is that possible? How do I go about it? Can I do it online? 

Ans. Yes, you can nominate your son in the policy. If your son is a minor (below 18 years of age), an appointee would be required. A change of nomination facility is available on the website of most life insurers. You can place a request via the same. In case it is not, you can connect with your life insurer via the official contact point, such as the contact centre, or visit the nearest branch to place the request.

Also Read: Continue Servicing Your Home Loan If There’s No Strong Non-Financial Reason To Prepay It

Q4. I am 42 years old and planning to buy a life insurance plan to invest in my family’s future. I am told I could add a few riders/add-ons, like accidental death and disability, to the endowment plan for comprehensive coverage. Is that advisable, or should I buy separate disability coverage? 

Ans. Adding riders like accidental death and disability benefits to an endowment plan boosts protection. These riders enhance the coverage and provide additional benefits in case of an eventuality. The waiver of premium (WOP) rider ensures savings are protected for beneficiaries without the breadwinner.

 

The author is the head of products and segments, HDFC Life.

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