Asha’s husband, who was the sole breadwinner of the family, suddenly passed away. With few assets and little savings, several thoughts were going through Asha’s heads;“How will I pay the monthly bills? How will my children and I live? What will happen to my children’s education?”
Insurance is something most people would prefer not to think about it. But some prominent reasons make insurance highlycrucial. Having insurance is a critical means to make sure your loved ones are taken care of should anything happen to you, particularly if you are the breadwinner for the family.
Having enough coverage in place for the dependents to survive beyond even after your demise becomes significantly necessary when you have debts. Moreover, having the correct set of insurance policies ensuresyou and your family continue to lead an established standard of living even if an unexpected event arises.
The question now is which insurance policy one should consider. Here are the three most crucial insurance types that a breadwinner must buy at the earliest:
1) Term Insurance
Term insurance can be of much help in case of an eventuality. Theseplans offer a fixed sum assured to the family of the policyholder in case he/she dies before the date of maturity. These plans have low premium as compared with the traditional life insurance policies.
You can buy large sum assured as much as 10 to 15 times of your annual income. However, there is no maturity benefit associated with these policies.
Why do breadwinners need term life insurance plans?
- To replace your income if you die unexpectedly
- To help your family cover the household expenses and medical bills
- To ensure your family has enough money to pay off debts
- To pay your children’s school and college fees in your absence
Term insurance policies can be easily compared online,based on price, as they are structurally similar and also simple to understand.
2) Health Insurance
Hospital bills, even for very small ailments are a pain now. With the responsibility of an entire family on a single individual, it is difficult to meet such high costs without burning a hole in the savings. With the medical costs escalating, the importance of health insurance comes into the picture.
No one wants the incidence of hospitalisation; however, one cannot rule it out totally. Although many employers provide health insurance covers, but with the high propensity of rotating jobs, one needs to have a health insurance plan of his own
A health insurance plan will cover:
- Trips to the emergency room
- Treatment in the hospital for inpatient care
- Your prescription drugs
- Your lab tests
- Mental health and substance use disorder services
3) Personal accident insurance
A personal accident insurance is equally important as the term and the health insurance.
Let’s assume that a person who is the only salaried member of the family meets with an accident that causes him disability. Due to the disability, that person will not be able to work for more extended periods of time.
In this situation, the term life insurance cover will not help since the person is very much alive. At the same time, the health insurance will only address the hospital bills.
However, a personal accident insurance cover is of much help here as it covers for accidental death and disablement. The disablements can include permanent total disablement, permanent partial disablement or temporary total disablement.
A breadwinner of a home must definitely opt for a personal accident insurance cover. An accidental insurance offers large covers that offer to pay the insured person in case of disability or death at a nominal cost. Most of the accidents arising in the normal course of life are covered under the accidental insurance covers.
Some points to remember:
- Run a quick online comparison by using the services of online comparison websites to opt for the best term or accidental insurance
- Choose a plan which provides you with the essential coverage
- Talk to the insurance company about the premium payable, claim settlement ratio, terms and conditions and other features if any
- Buy an insurance cover, in line with your income and needs
You are working hard to give all comfort to your family, so don’t let events like death, disability, ailments disturb your family’s peace. Buy the above listed insurance policies and get a safety net to your family!