Prajna Capital

Birla Sun Life Dynamic Bond Fund
How to save your Term Insurance premium
Health cover Reimbursement Claim

Posted: 06 Oct 2016 04:43 AM PDT

Invest Birla Sun Life Dynamic Bond Fund Online

Sometimes factors that are not in your control can have an impact on your financial goals.

By investing in Birla Sun Life Dynamic Bond Fund (An Open-ended Income Scheme) you have gone a long way towards potentially ensuring that they aren't affected by fluctuating interest rates.

	When interest rates are likely to rise: The fund invests in short-term bonds that mature faster, so that it can invest in newer bonds of higher rates.
	When interest rates have reached their peak: The fund invests in long-term bonds. Your investment then benefits from a higher interest rate for a longer term.
	When interest rates are going to fall: You will gain by selling your higher interest-rate bond at a profit. When the interest rate falls, the prices of bonds rise. Hence, bonds that were bought when yields were high are due to generate capital gains when they are sold in a falling interest rate scenario.
	The investment team of Birla Sun Life Mutual Fund, through its research and process driven investment strategy, would endeavour to capitalise on the available opportunities in a timely manner.

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Invest Rs 1,50,000 and Save Tax under Section 80C. Get Great Returns by Investing in Best Performing ELSS Mutual Funds

Top 10 Tax Saver Mutual Funds to invest in India for 2016

Best 10 ELSS Mutual Funds in India for 2016

1. BNP Paribas Long Term Equity Fund

2. Axis Tax Saver Fund

3. Religare Tax Plan

4. DSP BlackRock Tax Saver Fund

5. Franklin India TaxShield

6. ICICI Prudential Long Term Equity Fund

7. IDFC Tax Advantage (ELSS) Fund

8. Birla Sun Life Tax Relief 96

9. Reliance Tax Saver (ELSS) Fund

10. Birla Sun Life Tax Plan

Invest in Best Performing 2016 Tax Saver Mutual Funds Online

Invest Online

Download Application Forms

For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call

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Leave your comment with mail ID and we will answer them

You can write to us at

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Leave a missed Call on 94 8300 8300

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How to save your Term Insurance premium

Posted: 06 Oct 2016 01:49 AM PDT

While buying a term plan, many will concentrate only on the comparison of Term Insurance Premium of different companies. However, there are other methods by which one can save their term insurance premium. Let us see them in detail.

#1: Using Life Insurance Ladder–

How you arrive at the sum assured requirement for your life insurance? In simple terms, these are based on below assumptions.

You need money to cover your family expenses until your spouse dies or your kids get a job-To arrive at this value, you must know the current household expenses, number of years you need this income stream (up to the death of your spouse or job of kid), inflation of such expenses and suppose you die today then how much return you can expect from the corpus of term insurance maturity claim.
Based on your financial goals-Insurance requirement for such goals be arrived at by considering the current cost of your financial goals.
Based on your existing outstanding loans-You are clearing the interest part by paying the EMIs. Hence, you must consider the outstanding principal to arrive at insurance requirement.

Let us take an example. First, we calculate the total amount of requirement for meeting your family expenses. Suppose your monthly expense is Rs.25, 000, inflation of such expenses is around 9% and you are sure that these expenses will be for the next 30 years. In addition, we have to consider the return on investment (when we invest the death claim amount of term insurance) to meet these expenses for next 30 years. I mean to say that how much amount you need today so that we invest that amount in any product and start to withdraw money monthly from this. Hence, we have to assume the return on investment of such corpus. Let us assume this around 9%. The total corpus required for meeting these expenses will be Rs.90, 00,000. This amount is your insurance requirement to cover the household expenses for the next 30 years (in case you die today).

In the same way, we have to calculate for the each financial goal. For example, kid's education. You need Rs.15, 00,000 (in current terms) for education after 10 years from now. Let us assume the education inflation at 10% and return on investment to generate this much amount will be 9%. Then the current amount required to meet this goal will be around Rs.17, 00,000.

Finally, you also include the outstanding loan principal to your life insurance requirement. This is required, because if you die today, then your family member will pay and clear off the loan from the claim amount of Term Insurance. This let us say as Rs.50, 00,000 (current outstanding amount).

Many people add up all these figures and arrive at the sum insured requirement. In addition, they try to choose the term up to the age of their retirement or the maximum term offered by insurance companies. However, you all know that term insurance premium depends on the term you chose. The premium will be higher if your term insurance term is longer and shorter if the period is shorter.

Instead of sticking to one term plan and choosing a single term, if we split based on our requirement like one for expenses, others based on the tenure of financial goals and one for outstanding debt, then definitely this saves premium.

From above three examples, if we split our term insurance buying like Rs.90, 00,000 to meet the household expenses (up to your retirement age), Rs.17, 00,000 to meet the financial goal of kid's education and a term of 10 years, and finally Rs.50, 000 term insurance matching the term equal to loan tenure. Instead of having a term insurance of Rs. 1, 57, 00,000 (Rs.90, 00,000+Rs.17,00,000+Rs.50,00,000), if we split based on our requirement like above then it will drastically reduce your premium. We buy Rs.90, 00,000 sum assured term insurance with tenure of 30 years (Hoping you are 30 years of age and planning to retire at the age of 60 years), Rs.17, 00,000 sum assured term insurance with tenure of 10 years (to meet kid's educational) and Rs.50, 00,000 term insurance for tenure of 15 years (hoping loan tenure is 15 years from now).

This step of laddering your life insurance will definitely reduce the premium you pay towards term insurance.

Advantages of using the Life Insurance Ladder method-

Indirectly you are planning for your major financial goals. Hence, it creates a systematic financial approach.
You receive a fresh cash flow as and when the individual policies close.
It may lower your premium.

Disadvantages of using the Life Insurance Ladder method-

It may complicate nominee to handle all policies. Hence, better to have insurance with one company rather than choosing different companies.
It creates a major financial burden, in case you not planned for other goals. From above example, if one not planned for retirement and dies at the age of 55 years, then his nominee will receive the claim amount of Rs.90, 00,000 only (because two policies matured due to maturity of tenure of kid's education and loan repayment). However, if one opted a single policy until his retirement age, then his nominee will receive a higher sum assured (In above case Rs.1, 57, 00,000).
Tracking of term insurance will leads to complication. Because managing a single policy is easier than managing 5-10 policies.
Finally, if your insurance company giving you higher sum assured rebate or loads for a lower sum assured options then this may not actually save premium.
Postponing of goal may harm the goal funding. For example, you assumed that kid's marriage will be after 20 years from today and buy a term insurance matching 20-year term. However, if kid's marriage postponed to 24th year and your death occurs after 22 years from now then your nominees may feel hard to fund the marriage expenses. Hence, you must be particular about goal period.

#2: Buying at early age–

We all know that buying a term plan when young is cheap. Because term insurance premium depends on age. Younger the age means lower the premium. Hence, try to buy the term insurance immediately once you start to earn.

#3: Restricting your term of term insurance–

People have a tendency to try to get benefit at any cost from term insurance. They know that risk of dying is higher when they get old. Hence, instead of restricting the tenure up to their retirement age, they go beyond that. They look for term insurance, which covers them up to their age of 70 Yrs of 75 Yrs. However, sadly they forget the simple funda that, the value of current sum assured they looking for will not be same when they return at that age.

In addition, by increasing the tenure, you are indirectly increasing your premium payment. As I said above, longer the term insurance period leads to higher the premium. Hence, restrict your tenure to the maximum of up to your retirement age.

#4: Comparing the insurance companies–

There is a huge competition among insurance companies when it comes to term insurance. Hence, all companies lure you by providing the competitive rate. Therefore, do your own research to compare the premium. However, never compromise on the features you are actually looking for. Usually, new insurance companies offer lesser premium than the older. However, at the same time, I am not suggesting you to go for new companies. Instead, buy from a company, which suits your need and your comfort with the company.

Note-Never, heed the advice of comparative portals. I know they insist you for a particular company to go. Because there is a commission if they promote or sell a particular term insurance (even if it is ONLINE).

#5: Buying a plain product-Nowadays, insurance companies offer many variants of term insurance plans. Few of them are like premium back term insurance, part of the sum assured as a lump sum along with monthly income over a period or 100% of Sum Assured on death and a monthly income depending upon the option chosen: Level income or increasing monthly option. Understand your need, cost involved in such fancy offers then only try to buy.

Along with such fancy offers, insurance companies offer riders like accidental or critical illness. Nothing is free, that applies to here too. All these features will actually come up with a cost. Hence, don't buy those products which combine riders. Instead, I always suggest buying accidental or critical insurance policies from General Insurance companies. If buying them separately, then you will get many more features than these riders will.

Hope above 5 points will definitely help you to save the term insurance premium.

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Invest Rs 1,50,000 and Save Tax under Section 80C. Get Great Returns by Investing in Best Performing ELSS Mutual Funds
Top 10 Tax Saving Mutual Funds to invest in India for 2016
Best 10 ELSS Mutual Funds in india for 2016

1. BNP Paribas Long Term Equity Fund
2. Axis Tax Saver Fund
3. Franklin India TaxShield
4. ICICI Prudential Long Term Equity Fund
5. IDFC Tax Advantage (ELSS) Fund
6. Birla Sun Life Tax Relief 96
7. DSP BlackRock Tax Saver Fund
8. Reliance Tax Saver (ELSS) Fund
9. Religare Tax Plan
10. Birla Sun Life Tax Plan

Invest in Best Performing 2016 Tax Saver Mutual Funds Online
Invest Online
Download Application Forms
For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call
---------------------------------------------
Leave your comment with mail ID and we will answer them
OR
You can write to us at
PrajnaCapital [at] Gmail [dot] Com
OR
Leave a missed Call on 94 8300 8300

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Health cover Reimbursement Claim

Posted: 06 Oct 2016 12:22 AM PDT

Health cover Online

Policyholders can make health insurance claims either through cashless or reimbursement mode. Some hospitals do not offer cashless hospitalisation facility. In this case, the policyholder has to pay all dues to the hospital and then submit a claim to the insurer.

Intimation

In a planned hospitalisation, a policyholder intimates insurers about the forthcoming claim. In emergency hospitalisation, claim intimation must be sent to the insurance company or TPA within 24 hours.

Documents collected at the hospital

Before leaving the hospital, it is important to collect the discharge summary, copy of investigation reports, bills, prescriptions and pharmacy receipts.

Form

Policyholders need to fill up prescribed reimbursement claim forms. Some sections need to be filled by the hospital and signed by the doctor who treated the patient. The form can be downloaded from the insurer or TPA's website.

Bank details

At the time of submission of the claim, one should submit a fresh bank mandate with the policyholder's bank account details and IFSC. A cancelled cheque may be required to be submitted.

Submission

Claim form with documents like a copy of the policy, discharge summary, medical bills and investigation reports should be submitted to TPA. The claim must be submitted right after discharge.

Process

On receipt and scrutiny of papers, the insurer may call for other documents for processing the claim, or intimate the reasons for repudiation of the claim.

Retain old health insurance papers, as copies of these may be required when making reimbursement claims.

-----------------------------------------------

Invest Rs 1,50,000 and Save Tax under Section 80C. Get Great Returns by Investing in Best Performing ELSS Mutual Funds
Top 10 Tax Saver Mutual Funds to invest in India for 2016
Best 10 ELSS Mutual Funds in india for 2016

1. BNP Paribas Long Term Equity Fund
2. Axis Tax Saver Fund
3. Franklin India TaxShield
4. ICICI Prudential Long Term Equity Fund
5. IDFC Tax Advantage (ELSS) Fund
6. Birla Sun Life Tax Relief 96
7. DSP BlackRock Tax Saver Fund
8. Reliance Tax Saver (ELSS) Fund
9. Religare Tax Plan
10. Birla Sun Life Tax Plan

Invest in Best Performing 2016 Tax Saver Mutual Funds Online
Invest Online
Download Application Forms
For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call
---------------------------------------------
Leave your comment with mail ID and we will answer them
OR
You can write to us at
PrajnaCapital [at] Gmail [dot] Com
OR
Leave a missed Call on 94 8300 8300

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