Different types of Insurance everyone should consider and why

In general parlance a health Insurance policy is referred to a policy where the cost of hospitalizations are reimbursed (or paid directly to the hospital) to the policy holder. “Mediclaim” is the popular parlance for such policies though the brand “mediclaim” was made popular by the 4 nationalized general insurance companies.
Life insurance policies on the other hand pays the claim amount to your family in the event of your death during the policy period. So this covers a completely different risk as compared to a health insurance policy.
There are another type of health insurance policy which is equally important though frequently neglected or confused with the above “mediclaim” policies. These are policies (called critical illness policies in local parlance) that will pay the full claim amount if the policy holder is afflicted by the covered serious diseases (such as cancer, stroke, paralysis, multiple schelerosis, etc. ) and survives for 15-30 days after diagnosis. This policy is different from the mediclaim policy as the claim amount is paid without any reference to the expenditure incurred at the time of hospitalization for treatment of the disease. The lump sum received is meant to provide a lump sum amount that can generate income for the policy holder as his income earning capability is seriously affected when he is afflicted by these critical illnesses. Hence the policy amount needs to be as much as the life insurance policy value if not higher. Most people are not even aware of these risks and where they are aware they are satisfied with a policy of a small sum of Rs. 3 lakhs/Rs. 5 lakhs which does not serve the purpose of providing a lump sum to replace the lost income.

Insurance – Protect yourself from Miss-selling & Purpose of Insurance

In the context of Insurance the golden rule is Never mix Insurance with investment. Which means that insurance is basically meant to protect against an unpleasant (and unforeseen) happening. If it is a insurance policy that pays at an event that you look forward to than it is an investment um insurance policy and in all likelihood has been miss-sold. Another way to find out is a simple test – Was the concerned sales person overeager to sell the product – that is a fairly reliable sign of a miss sale in progress.

CNBC TV 18 Your Money: Health insurance for family & claim process


I am Sachin Sharma, 29 from ludhiana working in PSU, I want to purchase family floater health insurance plan for my wife age 28 and son 01 year old for 5 lacs cover. Kindly suggest me which company I choose whom cover critical illness rider also, offline or online and how much premium paid with complete claiming process.


Options: Appollo Munich, Religare or some nationlised bank my details are:


  • Annual income: 03 lacs
  • Term insurance: 30 lacs hdfc click 2 protect plus
  • Contingency fund: 01 lac


Dear Sachin,

I appreciate your decision to get your family covered as this will ensure that you are prepared to face any unforeseen medical emergency. However I would also encourage you to be a part of the family floater that you intend to secure your family with as it will continue to give you cover even if you plan to switch your job, when the insurance provided by your current employer stops.

Coming to the second part of your query on which company should you chose? You can consider buying Bank of Baroda Health Insurance policy of Rs.5 lakhs family floater which will cost you Rs. 7,182 p.a. Please note, the policy is renewable up to 80 years of age and is available only to Bank of Baroda account holders. Alternatively, you can consider of taking Apollo Easy Health family floater (2 Adults + 1 Child) for Rs. 5 Lakhs (Rs. 15,900) with add on Critical Illness of Rs. 5 Lakhs this will cost you (Rs. 17,391) irrespective of the mode of execution (i.e. online or offline).

Coming to the process of claim, it differs in planned and emergency hospitalization.

Planned Hospitalization

To avail for inpatient hospitalization services, you can go in any hospital in the country. If it is from the network of hospitals of the insurer, you can avail the cashless service, where you can get the treatment for free. In this case, the company pays your treatment expenses directly to the hospital.

Emergency Hospitalisation: 

But, in second case, where you or your family member gets the treatment in non-network hospital, you have to pay the bill and then can claim, up to the sum insured, for the medical expenses incurred.

You can claim the money by filling the health insurance claim form, which can be collected either from company’s office, from agents or online. The following information should be correct to claim for the reimbursement of medical expenses.

Name of the policy holder

Contact details

Policy number

Date and time of problem

Location of problem

Nature of problem

Remember to provide claim intimation to the insurance company before hospitalization and claim documents to the insurance company within 7 days of discharge.

CNBC Your Money: How to Invest for the first time investors


Dear Sir,

I’m new to trade in share market. I don’t know much about the discipline of this. I want to earn money with less amount of risk. Kindly suggest me top companies where I should invest. Also want to know how to multiply Rs. 1000.00 (thousand rs) to greater amount to invest in good company. I’m not in hurry and can wait for time.

Thanking You,
Gyanshu Kumar


Dear Gyanshu Kumar,

It’s lovely to know that more and more people like you are interested in investing in equity asset class and participate in the India’s growth. What excites me more is that you have a long term outlook. However I would strongly recommend you to take the mutual fund route to do so. But first a few lessons would be in order:
1. You cannot get high returns without taking higher risk. The whole idea is how to mitigate the high risk inherent in any equity investment. First is diversification, second is long term holding and third is systematic investments. Equity Mutual Funds allow you to do all the three.
2. Don’t have an expectation of spectacular returns expectations. Even the best investment strategy in the world cannot turn “Rs. 1000” in to a fortune. The quest to spectacular returns leads straight to the poor house.


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