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Different Types Of Retirement

When you think about retirement, you might wonder how much money you have saved, where you’d like to live, and when you want to start. People used to think of retirement as a time to relax on the front porch, play golf, and travel. But you might not be happy with that kind of retirement. Maybe you’re having trouble putting money away and could benefit from a rigid budget. Maybe you’re worried about losing your mental agility if you stop working, but you also value the social contacts it affords.The following are the different kinds of retirement:

What is Traditional Retirement?

Most people think of a traditional retirement when you say the word “retirement.” In this case, you work for the usual amount of time, which is probably until you’re in your 60s. Then you quit your job for good. So there are no part-time or extra jobs. Rather, you sit back, take it easy, and enjoy the time off you’ve earned by working hard.

For a traditional retirement, you need to have saved up a good amount of money. Most of the time, having enough money means starting early, investing wisely, and waiting as long as possible to take Social Security. So, you will have the most money waiting for you.

Remember that the rate at which you can take money out of your retirement fund depends on how long you expect to live. A person in excellent health with no significant medical issues in his past has a fair chance of surviving into his late seventies or possibly eighties  (and beyond). So, your savings should take into account how long you and anyone else, like a spouse or children, will need the money to live on.

What is Partial Retirement?

There are some retirees who decide to keep working after their careers are over. They’re known as “partial retirees.” People who take this path usually get a part-time job with fewer responsibilities. Or they can explore a hobby they couldn’t do before.

A retiree may work for several reasons. First, money. Living a life of partial retirement helps you save more money for retirement for a longer time. Since you still have income, you don’t need to take as much from your savings. Your nest egg lives longer.

If you anticipate working after your retirement, you don’t need as much savings. That means you don’t have to be as strict with your plans to save money for retirement.

What is Temporary Retirement?

Traditional retirement and partial retirement both end your career, but temporary retirement doesn’t. People who choose this path typically only retire for brief periods of time. They work in one field or job for a long time and then take a break. It can last from a few months to a few years, based on the person and how much money they have. 

A person who takes a temporary retirement might not go back to the same job. He may go into a different role within the same industry or try something altogether different. It depends on what the person wants and what their financial goals are.

Temporary retirement has the disadvantage of necessitating intricate financial preparations. As a result, you will not be able to save as much and will likely need to begin taking withdrawals earlier than someone with a longer career.

What is Voluntary retirement?

A voluntary retirement incentive known as “voluntary retirement” is made available to staff workers who are eligible for the program and meet specific conditions. The incentive is utilised by human resources (HR) as well as management in the process of right sizing a business.

Conclusion

Overall, your personality will determine which type of retirement is best for you. If you are worried about money, you might be more likely to take a traditional path. If you want to do something different from what most people do, there are other things to think about. In general, the best retirement is one where your needs and wants are both met. If you’re worried about your current plan for retirement, you might want to talk to a financial expert, like a retirement planner or financial advisor. Your future plans can be adapted with their assistance.

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Why is ULIP a better option for long-term wealth creation?

If you are looking for a long-term option for generating wealth, ULIP should be the best and the most reliable option for you. ULIPs are best suited for those looking for a long-term wealth creation plan. This offers you the benefits of both, savings and protection. Popularly known as Unit Linked Insurance Plan, ULIP provides both insurance and investment. It provides life cover with good returns and also helps in saving taxes. According to the current market situation, ULIPs are considered to be the best investment options.

Reasons Why ULIPs are a better option for long-term wealth creation

  • Flexibility – ULIPs are considered flexible because they help you in switching funds during your policy period. Out of all the financial tools, this is the only tool that gives you this option. It gives the option of moving the investment amount fully or partially from one fund to another to the insured. You have the option to choose any of them as per your needs or as to how your funds are performing. This includes growth, balanced, equity, and income funds.No cost is required even if you make 3-4 switches in a year. The only thing that is required from your end is, that you need to choose the policy, change its find allocation, and maintain it till your policy ends so that you are able to enjoy the long-term benefits.
  • Better returns than other financial tools – The other reason why ULIP is a better option is that it provides better returns. When compared to other financial tools, it has been noticed that ULIPs invest the premium that you have paid in several asset classes which helps in getting better returns, apart from this, it also gives you the option you can opt for different funds every year according to their performance.
  • Tax benefits -As per Section 80C of the Income Tax Act 1961, ULIPs also allow certain tax benefits. Certain factors are responsible for an ideal tax-saving option, such as lock-in period, maturity benefits, and amount of return. This in turn proves that ULIPs are a better option to invest in as compared to the other tools due to the benefits it offers.

Conclusion

All the above-mentioned points make it very clear why investing in ULIPs is a better option for creating long-term wealth. ULIPs maintain a perfect balance between providing insurance coverage and generating great returns. Therefore, choose wisely while investing in a financial tool.

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What is Total Loss in Car Insurance?

Although the procedure for buying auto insurance has been simplified, it is still challenging to comprehend the jargon used in the industry. There are many crucial terms that everyone should know before purchasing motor insurance. One such term includes total loss car insurance. Now, you must be wondering what exactly “total loss” means in insurance. Read the article to know everything about it in detail.

What is the Total Loss in Car Insurance?

A car is technically considered a total loss when the cost of restoring it to its pre-damaged condition exceeds the value of the car. A total loss might happen under two circumstances if your car is either stolen or severely damaged. In these cases, the car insurance company reimburses the IDV of the existing vehicle after deducting an excessive repair amount.

According to Section 55 of the Motor Vehicles Act, any vehicle damaged or destroyed beyond repair level should apply to the Regional Transport Office (RTO) for a total loss declaration within 14 days from the date of the accident.

Understanding Constructive Total Loss in Car Insurance

Total constructive loss is a condition in which car damages are beyond repair and the repair cost exceeds the car’s insured declared value. The car insurance company, at its discretion, may pay either for a vehicle, its portion, or accessories in cash. However, the liability cannot exceed the following:

  1. In cases of total and constructive loss of the car, the IDV of the car as defined in the schedule should be less than the cost of the damage.
  2. Other than the total and constructive loss of the car, actual and reasonable expenses of repair or replacement and damaged parts are subject to depreciation within the parameters indicated for a partial loss.

How is the total loss under car insurance calculated?

A car is considered a total loss only when the repair costs exceed 75% of the insured’s declared value. The IDV refers to the estimated market value of the car. Constructive total loss is the term used when the cost of repairs is greater than 100% of the item’s current market value. Whatever the case may be, the car insurance company will pay an amount equivalent to the IDV. The depreciation rate for calculating IDV is listed in the table below.

Vehicle’s ageDepreciation Rate
Below 6 months5%
6 months – 1 years15%
1 years – 2 years20%
2 years – 3 years30%
3 years – 4 years40%
4 years- 5 years50%
Above 5 yearsMutually agreed between vehicle owner and insurer

How to Get Full Value in Total Loss of the Car?

You can purchase the Return-to-Invoice add-on insurance cover if you want to make sure that in the event of a total loss, you receive the full replacement cost of your vehicle rather than the depreciated value. If your car is stolen or damaged beyond repair, you will be eligible to receive the full invoice value of it, including registration fees and all applicable taxes. In other words, you receive the amount you originally paid for the car’s on-road pricing if you’ve bought a return-to-invoice add-on coverage.

Conclusion

Uninvited accidents frequently result in serious vehicle damage. Total loss is a condition in which the car is destroyed beyond repair. If you have car insurance, the total loss amount provided by the insurer will be equal to the insured’s declared value. Furthermore, you can buy a return-to-invoice add-on cover to get the on-road market value for your vehicle after the accident.

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What is better – A guaranteed Savings Plan or Fixed Deposit?

Everybody wants the best and a luxurious lifestyle for themselves and their family. It is very important to have sufficient savings so that one can stay financially sound during uncertain times. However, keeping all the money in a savings account is not an appropriate financial decision. You can deposit your surplus amount in fixed deposits or any other financial tool.

What is a Guaranteed Savings Plan

A guaranteed Saving Plan is a non-participating plan that offers an endowment assurance at a fixed amount. As per this plan, the policyholder will have to pay the premiums for a fixed period of time. However, once the plan matures, policyholders will receive all the designed benefits of the savings plan. The policyholder gets an assured sum of all their premiums paid at the end of the plan’s term with other advantages. The additions consist of a fixed interest rate that is added each year. Along with this, the plan offers a maturity bonus as well at the end of the term. The ones who opt for a savings plan, also have the right to apply for tax benefits.

Features of a Guaranteed Savings Plan

Various features of guaranteed savings plans are as under

Premium

With a guaranteed savings plan, you can choose to pay the premium amount either altogether, or in parts. These options are provided to reduce the burden on the policyholders.

Policy Term

The policyholder can choose the term that covers their needs.

Guaranteed Maturity Benefit

Under this plan, the policyholder is assured of getting the benefits after the policy is matured. Also, the maturity benefit can be paid in case the policyholder survives after the end of the policy term.

Death Benefits

Death benefit is provided by many policy providers. The benefit is provided to the nominee in case of the sudden demise of the policyholder.

Trial Period

If the policyholder is not satisfied with the terms and conditions of the policy, then they have the right to cancel the policy and return the documents within 15 to 30 days of commencement.

Guaranteed Savings Plan vs Fixed Deposit

FactorsGSPFD
TenureTen to thirty years or even longerOne to five years
InvestmentMin: ₹1000 Max: LimitlessDepends from plan to plan and generally ranges between ₹2500-₹500 per month
ReturnsMonthly, quarterly, or annuallyGuaranteed set of pre-determined returns
PayoutCollected funds can be invested in monthly or annual installments, or a lump sum payout of the corpus can opt forLumpsum payout at the end of tenure
Tax BenefitsPremiums up to ₹1.5 lakhs are exempted under Section 80C of the IT ActNo benefits generally. However, the 5-year tax-saving FD offers benefits under Section 80C of the IT Act

Conclusion

With the above-mentioned details, you can easily differentiate between FD vs endowment plan and select which plan suits you well. Fixed deposits offer a flexible tenure, on the other hand, a savings plan offers a lot of maturity benefits. Therefore, it is advisable to have a combination of investment plans for a good outcome.

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Ways To Check E-challan Status Online?

In today’s digital world, everything is now possible through online platforms. Be it buying a car insurance plan, applying for a driving license, or checking the status of an e-challan, everything can now be performed online. In just a few simple steps, individuals can now check the status of their e-challan on the Parivahan website and pay the fines accordingly. So, let us understand all about the ways to check the e-challan status online.

What is E-Challan?

E-challan is basically an online receipt that mentions the traffic violation penalties that an individual needs to pay. The e-challan system was introduced by the Ministry of Road and Transport Highways in order to ensure transparency and accountability. As compared to physical challans where the offender of traffic law was supposed to visit an RTO and pay for the fines, e-challan provides convenience to pay for penalties in an online manner.

It is important to note whenever an e-challan is issued as a result of violating traffic laws, a message, as well as an email, is sent to the individual who has violated the traffic laws. Many states have in fact made use of MTP CCTV Challan systems to capture cases of traffic violations and instantly get an e-challan generated. There are traffic policies that also issue an e-challan to the individual violating traffic laws.

How to Check E-challan Status Online?

You can easily check the e-challan status through online mode by following the below-mentioned steps:

  • Click on the official website of e-challan Parivahan
  • Then, go to the ‘check online services’ option
  • Next, a dropdown menu will appear from which you need to click on the ‘check challan status’ option
  • Enter details like challan number, driving license number, or vehicle registration number, to check the challan status
  • Then, enter the captcha as prompted on the screen and click on the ‘submit’ button
  • Finally, you will be able to view the e-challan status online

Thus, checking the status of the e-challan status helps individuals to understand whether they are liable to pay any fine or not as a result of offending traffic laws. Moreover, if in any case if an individual fails to pay the e-challan, then their driving license might be suspended as well as may be liable to pay even greater fines.

Steps to Pay For E-challan

Here is how you can easily pay for e-challan through an online mode:

  • Go to the website of e-challan Parivahan
  • Enter details like challan number or vehicle number or driving license number
  • Then, after entering the details, you will be able to check the status of e-challan
  • Next, you need to click on the ‘pay now’ option. You can pay through net banking, credit cards, UPI, or other payment methods available
  • Once you have paid for e-challan, you will also receive a notification on your registered mobile number

Traffic Rules to Follow to Avoid The Issuance of E-challan

If you do not wish to get an e-challan issued in your name, there are certain traffic rules that you need to follow. Listed below are the common traffic rules that are mandatory for all:

  • You must always wear a helmet while riding a two-wheeler and wear a seat belt while driving a four-wheeler on Indian roads.
  • You must have a valid driving license.
  • You must have important vehicle-related documents like a vehicle registration certificate, vehicle insurance policy papers, and more.
  • Do not overspeed while driving and involve in rash driving
  • Do not drive under the influence of alcohol or drugs
  • Do not park your vehicle in a no-parking zone
  • Do not honk in a silent zone
  • Do not break the traffic signals
  • Use indicators while taking turns on the road

Here is a table that illustrates the fine you need to pay in case you violate any of the traffic rules.

Traffic LawsPenalties
Driving without a valid driving licenseRs. 5000
Driving under the influence of alcohol or drugsRs. 10,000 for the first time offence and Rs. 15,000 if the offence is committed for a second time
Driving without a seat belt or helmetRs. 1000
Driving without vehicle insurance papersRs. 2000 – Rs. 4000 and imprisonment
Over speeding and rash drivingRs. 1000
Driving overloaded vehicles  Discontinuation of license or a fine of Rs. 2,000

Take Away

Thus, we hope that now it will become easier for you to check the e-challan status online. However, we recommend you follow the traffic rules and drive safely to reduce the chances of paying e-challan.

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Tips To Prevent The Risk Of Cancer

Did you know, cancer is one of the second-most fatal health conditions in the world? In fact, according to reports published, the number of incident cancer cases in India in 2022 was 14,61,427. Moreover, it is predicted that by 2025, the number of cancer cases will increase by 12.8%. This data is a reminder of how important it is to spread awareness of cancer. In light of the same, every year 4th of February is observed as World Cancer Day to promote general awareness about cancer. This year the theme for World Cancer Day is “close the care gap” and the vision is to bring new initiatives in order to collectively fight against cancer as well as educate people about the different types of cancer. Read on to learn more about the different ways in which the risk of cancer can be reduced.

Different Ways To Prevent The Risk Of Cancer

As per studies, it is found that cancer occurs due to the abnormal growth of cells. Moreover, the primary reason behind so many people getting affected by cancer is the unhealthy lifestyle one tends to live. This unhealthy lifestyle includes the consumption of alcohol, tobacco, obesity, and so many more. Moreover, it is also important to understand that the treatment cost of cancer in India is extremely high, and not many people have health insurance. Thus, owing to all of these, it becomes important to adopt preventive measures to reduce the chances of cancer.

Listed below are the different ways in which you can reduce the risk of cancer:

  • Eat A Healthy Diet: First and foremost, it is very important that you eat a healthy diet. A healthy diet generally comprises of fruits, green vegetables, and other sources of nutrition that will keep your body healthy and fit. Moreover, in addition to eating a healthy diet, it is also important to cut down on calories, unsaturated fats, and others that unnecessarily result in increasing your weight.
  • Say No To Tobacco: In order to limit the risk of cancer, it is very important that you say no to the consumption of tobacco. This is because research has proven that the intake of tobacco adversely increases the risk of cancer. An unhealthy habit of chewing tobacco on a regular basis is in fact the main reason behind the different types of cancer such as mouth cancer, throat cancer, lung cancer, and a few others.
  • Maintain A Healthy Weight: In addition to everything else, it is equally important to maintain a healthy weight, as obesity is another factor that increases the risk of cancer. An unhealthy weight increases the risk of different types of cancer such as breast cancer, prostate cancer, and others. Thus, it is advisable to indulge yourself in physical activities like yoga, exercise, etc, on a regular basis for at least 30 minutes a day.
  • Limit Sun Exposure: There is no denying that basking in sun is good for health, however, excess of anything is harmful. Thus, to reduce the risk of cancer, it is important that you limit sun exposure as an excess of the same can lead to skin cancer. So, you should strike a balance and use preventive measures like applying sunscreen and staying away from harmful ultraviolet rays.
  • Do Not Compromise On Your Sleep Cycle: Getting quality sleep of at least 6 hours is very important to lead a healthy lifestyle. It is advisable that you maintain your sleep cycle, as compromising on that can result in increased body weight. This will indirectly also increase the risk of cancer.
  • Fight Against Pollution: Environmental pollution increases the risk of respiratory diseases but also leads to lung cancer. This is because long-term exposure to harmful air pollutants and inhalation of contaminated air disrupts the cellular process and thus increases the risk of cancer. .
  • Go For Regular Health Checkups: Another important step that you can do to reduce the risk of cancer is to go for regular health checkups. Regular health screening will help you detect cancer at an early stage. This will also help in starting the treatment of cancer at the right time.

Now, in addition to taking all the preventive measures mentioned above, it is also very important that you buy cancer health insurance plans. This will help you get financial protection if diagnosed with cancer. Moreover, with a cancer health insurance plan, you can also stay stress-free about the cancer treatment expenses and focus more on getting quality treatment for the same.

Final Wordings

Thus, it is very important that you follow the above-mentioned tips to reduce the chances of cancer as “prevention is better than cure”. Moreover, you should invest in a cancer health insurance plan and must compare the different health insurance plans for getting the best one for yourself.

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Tips to Keep in Mind While Buying Car Insurance in India

Car insurance is one of the most important insurance products that provide financial compensation in case your car is damaged, lost, or stolen due to any unforeseen circumstances. There are different types of car insurance plans such as comprehensive car insurance, third-party car insurance, and standalone car insurance. As per the Motor Vehicles Act of 1988, third-party car insurance is in fact a must-have for all car owners to ensure third-party liability is covered. However, there are certain things that you must keep in mind while buying car insurance in India.

What is Car Insurance & its Types?

A car insurance is basically an agreement between the insurance company and the policyholder, where the former agrees to provide financial compensation in case there is any damage to the car or a third-party or even if the car is lost or stolen. With a car insurance plan, you can get your car repaired at any of the network garages or even seek reimbursement in case it is not repaired at a network garage. Now, based on the nature of the coverage offered under a car insurance plan, explained below are the different types of car insurance plans:

  • Comprehensive Car Insurance: A comprehensive car insurance plan is one that provides coverage for both standalone damages to your vehicle as well as if a third-party is injured as a result of your vehicle. However, the premiums of comprehensive car insurance are comparatively higher.
  • Third-party Car Insurance: As the name suggests, third-party car insurance provides coverage in case a third-party individual or property is damaged as a result of your vehicle. It is important to note that irrespective of which type of car insurance plan you are buying, a third-party car is a must-have as per the motor laws.
  • Standalone Car Insurance: Standalone car insurance is another type of car insurance plan that provides coverage in case the insured car is damaged or lost. There is no coverage for a third-party damage under this plan.

Tips to Buy Car Insurance in India

If you are buying a car insurance plan for the first time, there are certain things that you need to be aware of such as the following:

  • You must be aware of the different types of car insurance plans that will help you choose the best plan for yourself. You must understand the differences between the different types and accordingly buy the right type of right car insurance for yourself. In addition to checking the different types of car insurance, you must also check the different car insurance plans offered by different car insurance companies.
  • You must always understand your requirement and budget and accordingly buy a car insurance plan. Always make sure to buy a car insurance plan that will fit your budget and for which you will be able to pay the premiums on time.
  • You should also check the different add-ons available that will help you enhance the benefits of a car insurance plan. Some of the different add-ons available with car insurance plans include zero depreciation cover, engine protection cover, no claim bonus cover, and more.
  • You should buy a car insurance plan with a company that has a larger number of network garages. This is because it is at these network garages, where you can get cashless repair facilities. So, the greater the number of network garages, the more beneficial will it be for you as a policyholder.
  • The premium of a car insurance premium depends on the installation of devices like anti-theft. So, you need to be mindful that the car insurance premium will vary depending on such additional features in your car.

Take Away

So, when you decide to buy a car insurance plan, you should always keep the above-mentioned tips in your mind.

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MUTUAL FUND VS. ULIP

A good investment strategy can help you to increase your wealth and could secure your family’s financial future. ULIPs and mutual funds are both attractive investment tools for investors looking to create wealth in the long term.

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What is a mutual fund?

A mutual fund is a financial tool wherein an AMC (asset management company) manages the money of several investors. The collected funds are then invested in different securities such as bonds, stocks, money market instruments, etc. The performance of your mutual fund scheme is directly related to the performance of these underlying securities.

Mutual funds are pooled investments that are managed by professionals who are called fund managers. It is similar to boarding a bus, wherein the driver takes all the passengers to a particular destination. In this instance, the driver is the fund manager, the bus is the mutual fund scheme, and the passengers are the investors. Fund managers are mutual fund experts who have good knowledge about the complexities and volatilities of the financial markets and make proper asset allotment decisions.

What is a unit-linked insurance plan?

A ULIP, comprises of both investment and insurance. ULIPs are insurance policies that offer an investor the potential to create wealth while simultaneously providing them with the security of a life cover.

Under ULIPs, a part of the premium goes towards providing the investor with a life insurance cover. The rest is pooled and invested in debt or equity instruments or a combination of both to help create wealth in the long term.

ULIP vs. mutual fund

 ULIPMutual fund
PurposeTo create wealth through investing as well as to avail a life insurance coverTo create wealth through investing
Regulatory bodyInsurance Regulatory and Development Authority of India (IRDAI)Securities and Exchange Board of India (SEBI)
policy termLong-termShort-term, medium-term, or long-term depending on one’s financial goals
Lock-in periodULIPs have a lock-in period of 5 yearsMost open-ended mutual funds do not have any lock-in period. A few exceptions are ELSS funds, children’s funds, retirement funds, etc.
Tax benefitsPremiums paid towards ULIPs are tax-exempt up to Rs. 1.5 lac under Section 80C of the Income Tax Act, 1961. Furthermore, the maturity amount is tax-free under Section 10(10D) of the Income Tax Act, 1961Equity-Linked Savings Scheme (ELSS) funds qualify for a tax deduction of up to Rs 1.5 lac under Section 80C of the IT Act, 1961

Conclusion

In a nutshell, the primary aim of ULIPs is to insure the investor’s life, while the primary goal of mutual funds is wealth creation. Choose wisely, and happy investing! The information given here is neither a complete disclosure of every material fact of the Income-tax Act 1961 nor does it constitute tax or legal advice. The ones who are investing are required to review the prospectus carefully and expert professional advice with regard to specific legal, tax, and financial implications of the investment/participation in the scheme

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Meaning of foreign portfolio investment

Investment in the stock market is popular across the globe. Whether you’re keen on the share market or not, you must have come across the term “foreign portfolio investment.” It is a situation in which investors outside the country hold securities and other financial assets. However, the investor does not have direct control over the company’s assets and is relatively liquid depending on market volatility. There are a variety of assets in foreign portfolio investment, including bonds, stocks, and cash equivalents such as bonds, marketable securities, T-bills, and others. Continue reading to find more information about foreign portfolio investment (FPI).

What is Foreign Portfolio Investment (FPI)?

Foreign portfolio investments, including stocks, American depository receipts, global depository receipts, and others, are held by investors living beyond the geographical boundaries of the nation. In addition to the above assets, an individual can also invest in bonds, mutual funds, or debt issued by companies or foreign governments.

The primary goal of investing in FPI is to maximize wealth from their investments. The largest and continuously growing economies around the world receive the largest number of investments through FPI. It is quite likely that an individual investor will use an FPI to invest in opportunities accessible outside of their native country. On a bigger scale, a country’s capital account, which includes its foreign portfolio investment, is represented in its balance of payments (BOP). The BOP determines how much money travels from one country to another in a particular fiscal year.

Foreign Portfolio Investment Example

Portfolio investment generally refers to purchasing securities on the stock market. For instance, a US investor might purchase shares of a company on the Indian stock exchange. Therefore, it will be considered a foreign portfolio investment. According to the reports, investors are gaining confidence in the Indian stock market after the fast recovery from the global pandemic.

Key Features Foreign Portfolio Investment

Listed below are some of the benefits of investing in foreign portfolio investments.

  • Investment in foreign portfolios will allow the investor to broaden their portfolios internationally and create the maximum return from them.
  • Due to its ability to source finance in other countries, FPI can supply creditors with a sizable revenue base.
  • When an investor owns a foreign portfolio investment (FPI) in a nation with a stronger currency than their own, the difference in exchange rates between the two nations may be advantageous to the investor.
  • The foreign portfolio investment option is suitable for retail investors because it requires less capital than FDI and generally entails less complex legal requirements.
  • Foreign portfolio investments yield returns more quickly than FDI. In essence, the investor has the freedom to sell the investments in his or her portfolio whenever they like, for the price at which that asset is currently trading.

Categories of Foreign Portfolio Investment (FPI) in India

Foreign portfolio investment in India has been classified into three primary categories that are listed below.

  • Low-risk portfolio: This consists of financial resources supported by the Indian government such as government bonds, any fund held by the Indian government, a sovereign wealth fund, and others.
  • Moderate-risk portfolio: An individual can invest in bank deposits, mutual funds, insurance coverage, pension funds, and other assets.
  • High-risk portfolio: This includes all comparable international portfolio investments that fall outside of the first two categories. For instance, charity or endowments.

Conclusion

Foreign portfolio investments are a great source of wealth creation. An investor can buy assets from other economically growing countries and get the maximum return on their investments. Individuals, companies, and foreign governments can make investments in foreign portfolios. There are various categories among which you can choose the one that is most appropriate for you.

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Is job-loss insurance helpful if you get laid off? Find Details!

With a recession on the horizon, companies across the globe have started cost-cutting by laying off employees. Despite being the sole breadwinner of your family or an individual struggling to achieve their dream career goals, job loss may bring a lot of financial burdens. However, during this tough time period, a job-loss insurance policy comes as a saviour. It can keep you protected against the cyclone of financial contingencies that may happen while you are looking out for new job opportunities. Read on to find out more about job-loss insurance in India and how it is helpful if you get laid off.

What is Job-loss Insurance Policy?

Job loss insurance is a financial tool that safeguards the insurer and their loved ones if the earning member of the family loses their job. In India, an individual is eligible to claim for job loss in cases of medical conditions like critical illnesses and accidental permanent disability. Any person who wants security even when they are jobless can include a job-loss insurance policy as an add-on to their standard health insurance plan.

At present, the Rajiv Gandhi Shramik Kalyan Yojana (RGSKY) is the only plan that provides standalone job loss insurance coverage. In addition to this, the government has also been involved in providing job-loss benefits under the Atal Beema Vyakti Kalyan Yojana to individuals who have been registered under the Atal Beema Employees State Insurance Corporation (ESIC).

Key Benefits of Job-loss Insurance Cover

Salaried-income individuals always look for a job with security. Though some people manage to continue in the long run, others may face layoffs. The job-loss insurance will act like your financial buddy during this tough time. Listed below are some of the advantages of job-loss insurance.

  • You have a source of income if you lose your job because of a critical illness, or any other disability.
  • Upto 3 months after a job loss, the insurance company will pay for the home loan and other liabilities of the insured.
  • You need not undergo any pre-medical examination to buy the plan.

What Is Not Covered Under Job-loss Insurance Policy?

Listed below are some of the exclusions under the job-loss insurance policy.

  • Job loss due to poor performance, fraud, or any other illegal activity.
  • The Individual himself has resigned from the company.
  • Contractual or part-time jobs are not covered.
  • Job loss during the policy’s waiting period is 30-90days.
  • If during the probationary phase, a job was lost.

The insurer must arrange valid proof of retrenchment to find out if you are eligible to claim job loss insurance coverage.

What You Should Check Before Buying a Job Loss Insurance Cover?

Claim rejections are a nightmare, so you can avoid them by asking the insurance company the following questions:

“Am I still eligible for the claim if an employer provides severance pay?” “Will I get a claim if an employer provides a termination notice period?” And lastly, “Do I get the claim if I have been laid off but don’t have any letter or document to prove it”?

You can inquire about them directly with your insurance company, or you can read the terms and conditions mentioned in the policy document to avoid any last-minute claim rejections.

What Documents Are Required To Claim Job Loss Insurance Cover?

Here’s the list of documents required to claim job loss insurance coverage.

  • Duly filled and signed claim form
  • Documents justifying the cause of job loss
  • Termination letter issued by the employer
  • Last 3-month salary slip
  • Information of employer
  • ID and age proof of insured

Conclusion

Undoubtedly, job loss is a period that may bring a lot of difficulties. Job loss insurance is a great financial tool that will give you a sense of security by providing coverage for medical illnesses and paying off loans and liabilities.

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