How is a double-accident life insurance policy different from a personal accident cover?
A double-accident benefit pays an additional amount equal to the sum assured of the base policy in case of death of the policyholder due to an accident. It is provided by life insurance companies either as a rider or as an in-built feature. If a policyholder opts for it as a rider, he will have to pay an additional premium. This is ideal for young people with increasing liabilities or the sole bread winners. Life insurers also offer accidental disability riders that provide waiver of premiums and/or a lump sum on permanent disability. Such riders are usually offered as a rider package called comprehensive accident protection.
Personal accident cover, provided by general insurers, is a standalone product that covers death, permanent, total and partial disability and temporary total disability. This also provides children's education bonus and medical expenses in case of death or permanent total disability due to accident.
Is a unit-linked insurance plan (Ulip) the same as an NAV-guaranteed plan? If not, do Ulips give guaranteed returns?
NAV-guaranteed plans are a specific category of Ulips, which guarantee the highest of the NAV declared periodically. The plan offers a guarantee of the highest NAV recorded during a specified number of years within the policy term. Such benefits are payable at maturity of the plan or on a pre-specified date.
The other category of guaranteed returns in a Ulip is not related to NAVs.
If a person dies before paying his renewal premium for a life insurance policy after it had become due, is a claim still admissible?
Yes, the claim is admissible, provided all the previous renewal premiums have been paid within the grace period.
There is a grace period of 30 days in case of annual premium, and 15 days for monthly premiums, within which the premium can be paid to keep the policy in force. In case of traditional plans, the unpaid renewal premium due is deducted from the claim amount before it is given to the nominee or assignee.
In case of Ulips, depending on the plan, there is no such deduction of unpaid renewal premium. The claim amount would be paid depending on the policy conditions applicable for the product, if lapsed.
The writer is the CEO of Bajaj Allianz Life Insurance. The views expressed are his own. Send your queries to yourmoney@bsmail.in
