HDFC Life Launched Click2Protect online term insurance plan

Private insurer HDFC Life said it has augmented its online channel with the launched of 'HDFC Life Clsick2Protect' - an online term insurance plan.

The plan is aimed for those who seek insurance cover at nominal premiums against their liabilities, HDFC Life said in a release issued here.

"HDFC Life Click2Protect is available in more than 750 cities across the country, the highest reach of an online term insurance plan in the industry. The objective of launching HDFC Life Click2Protect is to cater to the needs of informed customers based not only in metros, but in Tier 2 and 3 cities in the country," HDFC Life Executive Vice President and Head, Marketing and Direct Channels, Sanjay Tripathy said.

This plan is aimed at an informed customer who understands their liabilities; the extent of cover needed and is fairly conversant with online purchase practices. Click2Protect offers the convenience of experiencing a simple, fast, convenient, transparent, and cost-effective way of buying a life insurance plan, Tripathy added.

Apart from HDFC Life Click2Protect, HDFC Life also offers other online products such as HDFC SL Young Star Super II and HDFC SL Crest.

HDFC Life is a joint venture between Housing Development Finance Corporation Limited (HDFC) and Standard Life plc, the leading provider of financial services in the United Kingdom.

Online term insurance 8-10% cheaper

To cover your self from unforeseen risks in future, buy term plans or pure insurance plans online as against those sold through regular channels. Term plans sold online are cheaper as insurers pass on the cost saved on distribution (agent’s commission) and are loaded with features.

Term plans sold online are 8-10 per cent cheaper than those sold through an insurance agent.

Most life insurance companies have begun offering term plans specially designed to be sold online. Many companies such as HDFC Life Insurance will begin offering online term plans soon.

Gaurav Rajput, director (marketing) Aviva India Insurance said, “Online plans are cheaper than the ones sold through regular channels because there is no intermediary between the buyer and seller, thus, saving on commission. Also, the marketing costs of the company and perceived risk of death are significantly lower with higher persistency (because they have opted for the product themselves).”

Term plan or pure insurance policies are increasingly becoming popular with increased awareness about the need for life insurance. Term plans do not have any investment components and maturity benefits. To push online sales, insurance companies are adding more benefits to make their online term plans more attractive.

Suresh Agarwal, executive vice-president, Kotak Mahindra Old Mutual Life Insurance said, “In our online plans, we offer two additional features – step up and step down options. Step up option guarantees additional cover at certain important stages in life at a cost in hassle free manner. One can increase the sum assured without having to undergo any further medical examination.”

Click here to apply Life Insurance Delhi

Various stages could be marriage, purchase of house in India, birth or legal adoption of a child. A step down plan is subject to lower amount of cover only if minimum amount of cover available in the chosen plan. On stepping down, premium is recalculated based on revised sum assured. This option is helpful since one’s responsibilities don’t remain the same throughout life.

Aegon Religare that introduced first online term plan in the market plans to overhaul its existing online term plan (called iTerm) with more features. “We will soon launch iTerm with more features,” said Yateesh Srivastava, CMO, Aegon Religare Life Insurance.

You can also enhance your life cover by adding riders to the covers by paying a small additional sum. Popular riders include critical illness and personal accident. Basic features of term plans, both sold online and offline, are similar and suicide is excluded.

However, riders may have their own set of exclusions. For example, ICICI Prudential Life insurance lists engaging in aerial flights (including parachuting and skydiving) other than fare paying passenger on a licensed passenger-carrying commercial aircraft as an exclusion in its accidental death benefit rider sold along with iProtect term plan.

Subrat Mohanty, senior vice-president (strategy and product), HDFC Life said, “We have kept exclusions at a minimum for the basic term plan. The one exclusion that we continue to carry is on suicidal deaths. We shall not be liable to pay if death occurs directly or indirectly on account of suicide within one year from inception date or issuance date, whichever is later. There are separate exclusions for riders if opted for.”

High sum assured may not give enough cover

The policy, as the name suggests, provides term insurance to senior citizens.The minimum and the maximum entry age are 50 and 85, respectively. Though the product offers a whole life cover, it does not ask buyers to undergo medical tests. The premium paying term, though, will end at age 90.

The company offers a maximum sum assured of Rs 5 lakh. The minimum sum assured is as low as Rs 2,338. Both these apply only two years after the policy has been bought. If the policyholder dies before two years, the dependents will be paid 125 per cent of the total premium paid till date.

But despite the bonus of 25 per cent over the premium paid, the product is expensive, as compared to other term plans available. The annual premium for a 50-year male seeking maximum cover under IDBI’s Termsurance Seniors Insurance Plan is Rs 18,195. If the same cover is bought at the age of 85, it will cost Rs 213,890. The same person can buy a 10-15 year simple term from other insurers at Rs 6,000 annually.

However, there are differences in the features offered by the senior’s insurance plan that make it difficult to compare the product with other term insurance in the market. The maximum entry age for most term insurers is 65 years and they do not extend cover beyond age 75. Also, no term insurer gives a whole life cover.

Those available today are offered by traditional and unit-linked insurance plans. While the waiver of medical tests is allowed by insurers, especially for the smaller sum assured of Rs 5-10 lakh, buyers in the 60-plus age bracket have to go through with it.

The company has positioned the product for people nearing retirement and with inadequate insurance to support kin after their demise. Experts feel senior citizens opting for the policy would require an income stream even after retirement.

If the buyer opts for the minimum sum assured at the minimum entry age of 50, where he needs to pay premiums as low as Rs 1,000 annually, the amount still might not suffice. This may limit the number of takers for the product, unless it is targeted at those in the lower income bracket.

Products other than term plans can be doing well

Recently there has been a lot of focus on term plans. Online term plans are a manifestation of that. Your comments.

Term plan is a very relevant product since it gives you adequate amount of protection. But given the macro environment of this country, such as GDP (gross domestic product) growth, steady rate of household savings and comfortable demographics, and given that insurance is still under-penetrated, I think there are many product propositions that can be successful. It is for the insurer to know the needs of the customers and tailor products accordingly.

Are you planning to come out with an online term plan?

We do not have an online term plan right now. I think there are many things one should look at. If you look across the world, online term plans are not tremendously popular. About 6-7% of sales actually happen online. And I guess the reason is that insurance is a high involvement product. So the quality of advice also determines the kind of insurance a customer ends up buying.

Yes, but we are talking about term, which is a simple product and what would determine that sales would be the premium.

I agree there are definite advantages of selling online products. The point I am trying to make is that besides term plan, there are many other products that a consumer needs and should have access to. While the online platform will be attractive to customers who are aware, I think insurers also need to look at conventional distribution models and figure out ways to give attractive propositions to customers.

The industry is moving to unconventional models. In fact, recently the Insurance Regulatory and Development Authority (Irda) indicated that the agency model will become a thing of the past.

The insurance industry is still new in India. Even in advanced markets, such as the US or Japan, tied agents have just not gone away. While I appreciate what Irda is talking about and there is enough scope of innovation as far as distribution is concerned, I don’t see tied agents going away. What could happen is the way agents will work in the future as compared with how they worked in the past.

Give us an example.

Look at what happened between 2001 and 2011. Many good things happened but there were also structural gaps such as poor persistency ratios and low productivity by agents. Irda has been trying to address these gaps. Moving on, you may see a reduced agent force, but these will be agents who are serious about the profession and will deliver quality advice.

You said that the market is ripe for products other than term plans. What are these?

Pure endowment products and child plans. Also unit-linked insurance plans (Ulips), even though many are shying away. Ulips as pure investment products may not work but if you combine insurance and investment, then Ulips are good products.

But traditonal plans have no real rate of return since the returns are not able to outpace inflation.

You need to look at products as a combination of protection and returns. If you look at the level of protection from these products, they are good.

But you pay a heavy price for that protection. You pay much more than compared with a term plan.

Even then I guess there is space because there are certain investor needs which will get met through traditional plans. If you look at a pure child plan, the structure ensures that there is money to fund the child’s education in case unforeseen events were to happen. There are also plans which ensure monthly income for the family. So you structure the protection cover with a fair amount of investment return bundled in and I see space for these products.

What percentage of business comes from traditional plans?

About 75% of our business comes from traditional plans.

Life insurance premium may come down soon

Life insurance premium to be paid by young people and those between 50-60 years will fall soon as the Insurance Regulatory and Development Authority (Irda) is about to approve the new mortality table that will show higher life expectancy.

The impact will be most on pure insurance or term plans, and senior Irda officials said premium could fall 10-15 per cent. There will be a drop in premium of unit-linked insurance plans (Ulips) and endowment plans, which are insurance-cum-investment products.

“We are studying the data. We will soon approve it,” a senior Irda official told Financial Chronicle. The data were collected by Life Insurance Corporation and private insurers. The new table will be driven by the experience of LIC, which has a market share of over 65 per cent and a major chunk of traditional products portfolio.

The new mortality table is based on 2008-10 data and it was prepared by a committee made up of members of the Mortality and Morbidity Investigating Centre, an affiliate of the Institute of Actuaries of India, actuaries and members from the industry.

Life insurers now use LIC’s 1994-96 table, which was based on claims over the years, because private players started operations only in the past decade.

The table only provides mortality rate per thousand. According to Irda officials, the new table will have location-based information. “The country has been divided into five groups, with states falling into one of the groups based on life expectancy in the state. The new table will also contain data on gender and life expectancy of smoking and non-smoking population," said an official.

GN Aggarwal, chief actuary, Future Generali Life Insurance, said, “There will be a slight reduction in premium. Even though all companies use LIC data, they take into account that the data is old, so reduce the standard premium.”

Aggarwal said insurance companies had been reducing rates across segments over the years. “Premium has gone down 6-7 times in the past one year,” he said.

Mortality table indicates the rates that are to be charged on people of different age groups based on average life expectancy of a person in that age group. As a country develops and prospers, better health care and improved lifestyle lead to an increase in life expectancy, which is reflected in reduced mortality.

A senior industry official said life expectancy has improved by around 20 per cent over the past 10 years.

How to avoid Insurance traps?

A new year means new resolutions. Regularly exercising and eating healthy is important for good health. But remember financial wisdom is equally important to keep your money intact and growing. It is also time for drawing up plans for tax investments as well as regular savings so here are some tips to get you started.

• Don’t invest in Ulips for only 5 years
It can be difficult to lock in money for long so if you expect you might need money in 1-3years from now, Ulips is not meant for you. You should look at this investment product only if you leave your money untouched for be-yond five years. A good time horizon would be around 5- 30 years.

To better understand this let us take an instance. If you invest Rs 1,00,000 in a Ulip for 30 years, the first year return will be negative at around 80,000. This is because the investment amount itself shrinks to Rs 75,000 after accounting for charges such as mortality, policy, allocation and fund management.

However, the investor breaks even after the fourth year and doubles the investment in 30 years. Even if the investor locks in for 15 years, he earns Rs 20.5 lakh if he has invested Rs 15 lakh. Ulips are designed in a way that they attract maximum front loading in the first 3-4 years of the policy. So, stay long to reap maximum benefits.

• Try not to take home loan insurance
Everyone would love a home of their own. It has become easier to own one with help of a home loan. But one should always remember that until you pay off the loan it doesn’t become your house in the true sense. The aspiration to own a house comes with a heavy price tag and a huge liability. Hence, you have to cover the liability so that your family doesn’t have to shoulder the burden of EMIs if something happens to you during the tenure of the loan.

Although the home loan insurance policy works similar to a term life insurance policy, term cover is the cheapest option. The risk cover/ sum assured will be equally to the outstanding loan amount at any point of time. But home loan insurance works on a reducing balance principle. As the outstanding loan amount reduces, the size of the cover also decreases.

The biggest advantage of a term plan is that the sum assured remains constant in a term plan over a period of time whereas in a home cover, it is a declining cover.

Benefits of joint life policy

Insurance options for a couple need not be restricted to taking separate covers. A joint life insurance policy covers both the partners through a single endowment. It also help you save on premium but remember that the maturity benefits are lower than individual policies.
Example:

Abhi Aul (35) and his wife (30) recently took Rs 30 lakh loan for their house, the bank insisted they buy an insurance term plan. By doing this, the bank would get the sum assured in case any of them passes away. For the surviving spouse, it ensures paying off debts without liquidating other investments or assets.

Particulars Joint life Individual
Endowment*
Husband’s age (yrs) 35 35
Wife’s age (yrs) 30 30
Policy tenure (yrs) 25 25
Risk cover (Rs/lakh) 60 60 (30+30)
Maturity benefit (Rs/lakh) 30 +
bonus 60 + bonus
Annual Premium (Rs) 148,957 2,31,857
(1,18,402+1,13,455)
*Individual Rs 30 lakh policies for a 25-year tenure
Since the couple is employed, they planned to share the total equated monthly installment (EMI). Taking separate term plans of Rs 30 lakh each was an option but they opted for a joint life insurance policy.
Currently, only Life Insurance Corporation (LIC) sells such a policy. Few banks offer cover under a group policy that their insurance partners underwrite exclusively for the lender. But the premium is to be paid in lump sum and provides cover only to the extent of the outstanding loan.
Note:
• In case the spouse is a housewife, her insurance cover will depend on her financial standing.
• Premiums can be paid by either of the partners.
BENEFITS
• A joint life plan waives off the future premiums and the survivor gets the sum assured immediately on the death of the partner.
• The plan also has an accident and total disability benefit as a built-in feature.
• If the surviving partner is alive through the policy term, he or she will also get the bonus accrued along with the sum assured.
• In case, both pass away, the nominee would get both the lump sum and bonus.
In Aul's case, death of either of them will mean the surviving spouse will get a risk cover of Rs 30 lakh. The bonus amount will continue to accrue in the policy.
COSTS
Joint life plans work out cheaper if you compare the premium paid for them as compared to individual endowment plans. The Aul's will pay Rs 1,48,957 as annual premium. Had they opted for individual endowment plans of Rs 30 lakh each, they would have paid a combined annual premium of Rs 2,31,857. However, if the policy matures, the surviving partner (or both), will get only Rs 30 lakh and the accrued bonus in a joint life plan. In an endowment plan, it would be Rs 60 lakh plus bonus.
CORPUS FOR FUTURE
If both partners survive till maturity, the amount can be used to buy an immediate annuity plan. This is how Aul’s have planned to add to their retirement corpus.
Even surviving partners could use the same strategy. While there is no burden of paying the premiums, the risk cover shall continue.
Points to bear in mind:
• Before taking a joint life policy, ensure that your relations with your spouse are stable, with no indications of a possible separation. Considering it defeats the very purpose of this policy.
• The taxation in this plan is similar to other life insurance products. The proposer of the plan gets a deduction in his taxable income under Section 80C and any claims or maturity arising out of the plan comes tax free u/s 10 10(D).

Low returns, but secure

Buyers of traditional insurance products — endowment and money-back policies — might soon be inundated with options.
Insurance companies, which have been incapable to launch latest investment-cum-insurance plans, better known as unit-linked insurance plans, following the turf war between the Securities and Exchange Board of India and the Insurance Regulatory Development Authority, are introduction a number of traditional products to attract customers.
Some new launches are Bajaj Allianz (BA) Invest plus Premier, Birla Sun Life Insurance (BSLI) Bachat Endowment Plan, Reliance Life (RL) Traditional Investment Insurance Policy and Reliance Life Traditional Golden Years Plan.
The RL Traditional Investment Insurance Policy is the third addition to the traditional crop portfolio of Reliance Life Insurance. Malay Ghosh, executive director and president, RL Insurance, said, “The visible cost structure of the policy is an attractive feature for customers.”
The unique characteristic of the product is that it offers a fixed rate of return – a number which will stay changing every year. This year the rate of return will be 7.75(%) per cent. The next year, a new rate will be announced depending on market circumstances and the interest rate scenario. The only assurance: The return will not fall below the savings deposit rate, which is 3.5(%) per cent at present.
In addition to guaranteed returns, the sum assured in case of RL Traditional will be 7.5 times the premium paid in the 1st year. There will also be riders that one can add by paying extra.
The sum assured, however, will be inconsequential once the accumulation account amount touches the sum assured — a common feature of all traditional insurance products.
The costs include an allocation fee of 30(%) per cent in the 1st year and 5(%) per cent in following years, which is deducted from the premium paid.
Besides the allocation fee, mortality rate (charged per Rs 1,000 of sum assured), policy administration fee (Rs 40 per month) and account administration fee at the rate of 1.25(%) per cent per annum will be charged.
Therefore, if an individual plans to invest the minimum regular base premium of Rs 10,000 this year, Rs 3,500 will be deducted as allocation and policy administration fees.
The rate of return offered is not very competitive compared to other instruments such as the Public Provident Fund, which gives 8(%) per cent and has negligible costs.
Does it make sense to invest in this or similar policies? Financial planners would most probably say no. That’s because the rate of return is quite low. Also, the sum assured is not very high. In comparison, a 30-year-old can buy a 20-year term plan with a sum assured of Rs 20 lakh for a premium of Rs 4,700.
Govind Pathak, director, Acorn Wealth, said, “For sufficient insurance, a simple term plan can be sufficient and a more cost-effective option. And for investment, one can always look for multiple options which will assure higher returns, such as the PPF on the debt side.
On the equities side, there are many more options like mutual funds and stocks. This combination would possibly give higher returns as well as a larger life cover than the Reliance traditional policy.

Tweak commission configuration: Irda

In what may lead to lesser front-loading of insurance policies, the Insurance Regulatory and Development Authority (Irda) plans to increase the commission over the tenure of the policy.
“We are going to ask insurers to propose ways to increase persistency levels. This will happen only after they tweak the commission structure,” said a senior Irda official.
Most insurance policy is extremely front-loaded. For instance, insurance agents earn over 40(%) per cent as commission in most unit-linked insurance plans (Ulips) in the first year. Even commissions for term plan and endowment plans are 20-35(%) per cent in the first year.
The commissions refuse considerably, particularly for term and endowment policies, after the first year. The agent, as a result, loses interest in pursuing the policyholder.
In case of mutual funds, the distributor earns a commission of 1.25(%) per cent in the first year (upfront fees plus trail commission). After that, there is an annualized trail commission of 50-75 basis points every year. This, the mutual fund industry said, keeps the point interested in the investor.
By proposing to extend the commission over the tenure of the plan, Irda thinks agents will continue to follow the policyholders.
Recently, Irda had extended the minimum term of an Ulip from 3 to 5 years. It had also made other proposals, including capping the first year surrender charge at 15(%) per cent for a policy over 10 years. This surrender charge would continue declining and go away in the 6th year.
However, experts said persistence levels were already on the rise.
“Persistency levels are already improving because of the events taken by Irda in the last two years. Tenure of products has left up as the lock-in has increased to five years,” said S B Mathur, secretary general, Life Insurance Council.
The insurance industry reported 80(%) per cent persistency in 2008-09, an increase of 7(%) per cent over the previous year.

Irda tightens norms for recommendation agencies

To regulate non-banking entities acting as referral agents in the life insurance space, the Insurance Regulatory and Development Authority (Irda) has capped the transfer fee paid to this channel.
Irda said as insurers were following several different practices, this was resulting in high cost of gaining, pushing up premiums for policyholders.
“Referrals are increasing the already spiralling costs of insurers. Therefore, in the interest of prevention of further escalation of costs, it is important to simplify the fee structures allowed to these entities,” Irda said.
At present, the whole area of referral arrangements with non-banking entities, including individuals, is not regulated.
“This will also prevent multi-level agencies from entry into selling insurance products that do not follow any code of conduct. This will support transparency in the system,” said an Irda official.
Irda said referral fee should be paid only on successful conversion, with a linkage to sale by the company’s sales person and such fees. Other costs incurred should not exceed the ceilings on commissions. Commission on pure term plans goes up to 35(%) per cent, whereas on unit-linked insurance plans (Ulips), the commission paid is around 7.5(%) per cent and for Ulip life cover it goes as high as 40(%) per cent.
As per the recommendations of the Govardhan Committee, the regulator proposed a minimum networth of Rs 50 lakh for referral agents and a turnover of at least Rs 1 crore for the last three consecutive years. Also, the company should not have total income from its referral business with an insurance company or any other organisation, more than 10(%) per cent of its total income in any year.

Understand your needs before buying insurance

Points to remember before Buying an Insurance Policy:
Insurance is a necessity in this fast moving life full of contingencies, therefore it is really important to get yourself insured to secure your loved ones in such unforeseen moments of your life. Nowadays Insurance is sold more as a product rather than a service where the insurance seekers are misguided while buying a policy. So before taking a plan you should be aware about your need to buy Insurance Policy.

What do you want your Insurance policy should stand for?

The most important element to buy Insurance is your need. The various elements that Insurance can be bought are mentioned below. Read to know which one is best suited to fulfill your requirement in life:

1. Term Plan- Required for people who want life cover in case of there death. The sum assured will be given to your nominee. In case you survive, then there is no amount that will be paid back to you.
2. Pension Plan- This plan ensures fixed monthly income for you in your golden years by investing small amount today you can cherish all the moments in your life post your retirement too. Check here to calculate your Monthly Pension Amount - Retirement Calculator.
3. Children Plan- The plan offers to secure the future of your child. With the help of a Children Plan you can design the future of your child the way you want it. There dream of becoming a doctor or an engineer or a professor can easily be fulfilled by just investing small amount.
4. Investment Based Plans- Insurers offer two kinds of plans to stay invested to earn returns along with a Life Cover. A) Conventional Plans B) Market-Linked Plans.
A) Conventional Plans- These are those plans wherein your money is invested in government backed securities, AAA rated bonds & etc., having minimal risk.
B) Market-Linked Plans- These are typically known as ULIPs & wherein the investments are done in market-linked instruments, as per your risk appetite you can choose the debt-equity proportion varying across different funds.

Points which must be taken care while buying an Insurance policy to avoid mis-selling:

1) Charges: There are different set of charges which an insurance company charges like Fund Management Charges (FMC), Mortality charges, Admin Charges, Allocation Charges etc. The agents sometime don’t disclose these charges but you really need to check before buying an insurance policy.
2) Illustration: Always ask for an illustration from the agent as it helps you to get exact figure of your fund value @ 6% & 10%. It also helps you to know all the charges & taxes included in the policy.
3) Documents: An Insurance policy can not be logged in without proper documents of the customer like Photograph, Address proof, Identity proof & Income proof (if required), always mention on the documents purpose of providing the documents ex- For purchasing Insurance cover only
4) Terms of the policy: Always cross check all the terms of the policy explained by the agent must be same in the documents/bond you’ve received against the policy you have bought. If it seems to be different, then according to IRDA rule you can return your policy within 15 days time period from the date of policy issued. This period is called "Free Look-up Period".
5) Last Minute Tax-Planning: If you are sincerely planning to secure your family with a policy, then you must do it after a proper examination of the plans & their charges insurers offer. Most of the customers procrastinate their insurance buying decision till March so as to save taxes, however during this time there is a lot of rush and you might just select a plan in a hurry without looking at the charges & fee, therefore its always advisable to take a plan in advance so that you have good enough time to look at the plan details comprehensively.
6) Go for a comparison: Always try to get comparison from different Insurance companies' agents to understand the things better. Compare the benefits as well as the charges of the different companies & chose an appropriate plan best suited for your requirement.

So, do check these things before buying an insurance policy. It is better to do your home work before buying an insurance policy.

Bimadeals is here to help you out in getting comparison from all major Insurance players. You can compare and buy the insurance plan you feel important for yourself and can live a secured life.
To get a better comparison it’s really important to meet the advisors of different companies so that you can sort all your doubts regarding the plan you require and want to buy.
An online comparison can only help you out when you are planning to buy a Term Insurance plan as there you only need to compare the rates and eligibility of different insurance companies, for which you can refer to the link below:
Term Plan Quote
We recommend Term Plan is a Must Buy for the people who have dependents.
Buying a term insurance plan is really important as this is the cheapest form of Insurance where you can secure your loved ones life by only investing a little money. Only after paying a small premium amount you can save up an adequate amount to fulfill your families' needs in your absence.

Do you know your or others Human Life Value.

The most used definition of HLV is the expected lifetime earning of an individual, i.e., what is the total income that an individual is expected to earn over the remaining years of his work life. In other word, one can say how much would your family need in your absence. This is a tough question. We have tried at our end to resolve this query.
The most efficient way to do it is to calculate Human Life Value.
Human Life value tells you the appropriate amount of sum assured you need to have at present in case of any uncertainty in future. In other words, it is the amount that your family will require if you are not alive. All good financial planners mostly do try to come out with human life value.
Human Life value is determined by 3 main factors: -
 Age.
 Current & Future Expenses.
 Current & Future Saving.

How to calculate?
Let us take an example, where HLV is calculated for Mr P.Raichowdhury based on the present needs & income. Mr P Raichowdhury aged 43 years has an annual income of Rs 10 lacs, spends 3 lacs on his personal expenses, he has a fixed deposit of Rs 6 lac, he also has a loan of Rs 10 lacs and plans to spends 10 lacs each on his son’s education & his daughter’s marriage. His human life value will be as follows:

Annual Income- 100, 00, 00
Less Expense on Self-including Taxes- 300, 000
Contribution toward family standard of living- 700, 000
Multiplying factor- 15
Gross human life value- 105, 00,000
Less liquid assets- 600, 000
Add liabilities- 100, 000
Add amount to fulfill family needs- 200, 00, 00
Human Life value- 129, 00, 000

* We are not including property or jewelry in the above example.

Age Multiplying factor
Up to 35 years 25 times
36 to 40 years 20 times
41 to 45 years 15 times
46 to 50 years 12 times
51 to 60 years 10 times
61 to 65 years 5 times


HLV is just an idea that how much money one should keep aside for financial security of one’s family. To know the exact HLV you can contact any financial advisors. Once you are aware of the amount, you can choose between various life insurance plans for covering yourself.

What we advice is that if you don’t have any Insurance with you, you should at least go for basic Term Plan which is least expensive Insurance. To check Term plan rates as per your age and all companies click here. Term plans do not provide any returns but will give valuable cash in difficult times.

So the easiest way to do this is Life Insurance.

Different people will have different ideas to secure there family future like investing in properties, but our question would be, the hassles involved in selling property or to a create cash is really difficult.
Where as Life insurance provides liquidity & quick money at the time of emergency in case the bread earner of the family is gone.

Life Insurance Policies to be Paperless, as soon

The Life Insurance Council is working on a plan to digitize the sector, which could mean that life insurance policy holders may no longer need to keep paper records of their policies. The plan needs to be approved by the Insurance Regulatory and Development Authority (Irda) before customers can pick its benefits.

Life Insurance Council, which is a body intended for the development and co-ordination in the Life Insurance sector, is analyzing the plan and expects to be finalized within a month, reports PTI. "The proposal will be finalized in a month. We are investigative the issue. The present system involves a lot of logistics," said S.B. Mathur, the Council's Secretary General.

Demat, or digital arrangement of storing information, will appreciably save distribution costs for insurance firms. Two depositories - National Securities Depository (NSDL) and Central Depository Services (India) (CDSL) - together hold and handle accounts in the electronic form or demat accounts. NSDL maintains over one crore demat accounts, while more than 64 lakh accounts are managed by the other depository CDSL.
For More Information about Insurance Policy.
Term Plan, ULIP