I am 34 with an infant daughter. Is this the right time to buy term insurance and how much cover do I need?

These are a set of queries raised by ET Wealth readers, which have been answered by our panel of experts.

I am 34, a doctor, married with an infant daughter. Is this the right time to buy term insurance? If so, what cover and amount should I consider?

Kapil Mehta, Co-founder, SecureNow: This is the perfect time for you to buy a term plan because you are young and have dependants. Term plans across insurers are similar. They pay a large sum assured if you die but nothing if you survive the policy term. The policy terms are standardised by the regulator; so you may check with a set of five insurers and pick the cheapest. The sum assured that you take should ideally be 10 times your annual income. If you find that expensive, then start with five times and buy additional cover every few years. You should have a policy term until the age you will most likely retire. For doctors, this is often around 65 years. Do specify a nominee clearly in your application. Finally, when you do buy the insurance, remember to renew it timely each year so that you remain locked into the premiums of the term plan you bought.

I am 75, retired government employee, and covered under a corporate group floater policy from Oriental Insurance with Paramount Health Services as the TPA. Last November, I slipped in the bathroom and fractured my wrist. An orthopaedic doctor treated me with plaster, and no hospitalisation was needed. However, my Rs.7,000 claim was rejected on the ground that OPD treatments are not covered under the policy. Can I approach a consumer court on this?

Kapil Mehta, Co-Founder, SecureNow: Your claim is not payable under a group health insurance unless there is a specific provision to cover OPD costs. This does not seem to be the case and it is likely that approaching the consumer courts will not be fruitful. They are also likely to go by the policy wordings. Fractures are typically covered in a Group Personal Accident plan. You might want to check if you have personal accident coverage, as this is often offered along with group health insurance schemes. For the future, you might want to buy an individual personal accident plan for such accidents. If you have a personal health insurance then it may also be possible to add a personal accident rider to that when renewing your insurance.


Our panel of experts will answer questions related to any aspect of personal finance. If you have a query, mail it to us right away. Email ID: etwealth@timesgroup.com