Are Airtel's 'prepaid' insurance plans as good as standalone policies?

High competition in the telecom industry has led to a spate of offers from existing firms. The offers include Netflix, Amazon Prime, Airport lounge access, free handset insurance, and now, even a life insurance policy. Yes, Bharti Airtel’s (Airtel’s) latest prepaid recharge plan offers exactly that — a free life insurance policy. Says Vikas Seth, managing director and chief executive officer, Bharti AXA Life Insurance: “The life insurance cover is available to all customers aged 18-54 years and requires no paperwork or medical test. The objective behind this offer is to ensure life insurance cover to every customer with each recharge and helps him/her leverage its benefits.” Bharti Axa Life Insurance has tied up with Airtel for the Rs 179 prepaid offer, which gives cover for Rs 2 lakh, apart from unlimited calls to any network, 2 GB data, and 300 SMS.
 

Earlier this month, the telecom company introduced a Rs 279 prepaid plan, with Rs 4 lakh insurance cover from HDFC Life. It provides unlimited calls to any network. It also comes with 1.5 GB data and 100 SMS per day. Besides, there are features such as Xstream App Premium, which has free shows, music, and movies via ZEE5, HOOQ, and 350+ Live TV Channels.
 

Each recharge is valid for 28 days in the case of both.

How does insurance work? The policy is generated on your registered name. Subsequently, you need to fill in your address and nominee details. It requires no additional no paperwork or medical tests. You get the policy certificate in digital form. If you want a physical copy of the insurance certificate, you will have to make a request. The customer needs to be between 18 and 54. The policy is directly between you and the insurer. For claims and all other queries regarding insurance, you have to get in touch with the insurance company. You have to be an active user for your nominee to make a claim.

Most importantly, if you recharge with any other pack, your policy will lapse. Remember, even if you buy multiple prepaid cards, life insurance partners will service your claims on the policy that applies to you. In other words, it would make sense to stick to a single kind of a prepaid plan because otherwise, the documentation will change almost every month. And keeping track of that will be very difficult.
 

Tarun Birani founder, TBNG Capital Advisors, which is registered with the Securities and Exchange Board of India, says: “Principally, a prepaid card is a good choice especially if you are seeking a second number. It can also work for homemakers, or if you want to give help like your driver, housekeeper, etc.”
 

“The member is insured with the Master Policyholder under a group policy while the premium of any standalone term insurance plan depends on the age of the prospective customer and the policy is an individual life insurance policy,” says Birani. So comparing a complimentary insurance offer to a standalone one is like comparing apples with oranges.