How To Get Your Money's Worth from Insurance Policies

Insurance is essential to ensure a peaceful future and assure your family and yourself of a backup option in case of an unpleasant and/or unexpected eventuality. 

While some types of insurance such as life insurance cannot bring back a life, it can help towards securing the future of the insured's dependants. These days there are insurance options available for almost everything that is valuable - life, medical treatment and hospitalization, home and office insurance, vehicles and so on. As depicted in many insurance company advertisements - they insure anything from pins to airplanes!

Now, you may know that a premium should be paid periodically, in order to keep your insurance coverage valid. Premium amounts are calculated based on the value of the insurance taken out along with a few other considerations. Is the premium amount variable, can you get a better deal for the same amount of premium paid? Is there a benefit in case you do not need to claim the insurance amount?  In short, how do you ensure you get your money's worth from insurance policies?

Firstly, choose an experienced insurance advisor or broker who can evaluate your requirements, ability to pay premiums over a period of time, the value of the object of insurance, and so on. 

In most countries, life insurance packages offer options for savings along with insurance for your life.  When claimed, the entire amount is paid to your dependants. If a need to claim does not arise, you are eligible to receive the saved amount, interest and in some cases an additional bonus at the maturing of the policy.

Health and medical insurance policies must offer cashless settlement of claims, minimal paperwork, immediate hospitalization and medical attention in case of emergencies. They should cover as many or all of the expenses in case of a medical emergency such as ambulance, pharmacy, outpatient care, pre- and post-hospitalization expenses, plus provide a cash amount for sundry requirements during the hospitalization period. Some policies become invalid if you contract any of the scheduled diseases or conditions such as a permanent disability. Check for an insurance policy that will remain valid even after any such eventuality.

Then there are the options of insurance for other requirements such as claims arising in course of travel. Here, ensure that it covers most incidents that may occur in the course of travel such as loss of baggage, delays in flights, consequent losses that arise due to delay or loss in one stage of your travel, etc. Prior to obtaining travel insurance, check to see the coverage provided by your airline, you could opt for the remaining as a separate travel insurance coverage.

The insurance policies for securing your office and belongings at home or elsewhere, against loss of income or employment, against professional claims and so on are mostly straightforward, covering a limited set of claims and eventualities.

In general, it is highly advised to observe the following guidelines while obtaining insurance policies -

  • Take time to read, understand and assimilate the terms of your insurance policies. Get your insurance adviser to explain the insurance package clearly. Review the frequently asked questions (FAQ) documents, if provided.
  • Provide accurate information of self and insured items; do not hide any facts relating to health, ownership of items; do not under-value items for insurance.
  • Pay premiums on time; observe all the terms and conditions of the policy.

These tips should certainly help in getting your money's worth from an insurance policy.


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