From living a consciously healthy life, to building our savings and investments in a systematic manner, we constantly strive to nurture a stable future. Seldom do we feel completely secured about what future has in store for us. Which makes us wonder if we can ever feel completely protected against the unforeseen? The likelihood of this happening is higher when we fall short while answering questions such as ‘what constitutes risk’ and ‘what comprehensive financial protection means’. Broadening our perception of protection is the first step in inching closer to an empowered, secure life.

Risk of dying too early

If the breadwinner of a family dies unexpectedly, his family will suffer the financial loss of those potential earnings resulting in obligations remaining unfulfilled. This uncertainty is termed as ‘risk of dying’ too early and it can be protected against through life insurance. Life insurance is that financial asset that ensures that in the event of the demise of the bread winner of the family, life stage goals of his / her dependents are taken care of. 

Risk of living too long

According to a report by United Nations Population Fund, India recorded an improvement in life expectancy at birth by 9 years. Growing to 69 years in 2019 from 60 years in 1994[1], the country’s population is looking forward to longer life spans which is why securing the financial future is important.  The earlier one starts planning for retirement, the better and easier it is to accumulate a sizeable corpus for the long run. It is easy to save for retirement during the early stages of one’s career when there is no pressure to support a family and minimal health expenses.

Risk of disability may impact earning capacity

Given the level of uncertainty that shadows everyday of our lives, we can never be too careful. A disability when it occurs can prove to be cumbersome, hurt quality of life, and can also be very expensive.  An accidental disability rider are thus a very valuable add-on available to policy owners upon purchase of a life insurance contract.

Risk of unexpected health problems

Unexpected healthcare needs and costs are a major concern for anyone. With growing incidences of health problems, and rising costs of hospitalisation, there is little escaping the predicament. In the face of rising costs of healthcare and incidence of lifestyle problems, not having adequate protection could prove to be extremely risky. In addition to a health insurance policy, a critical illness rider to your life insurance policy can help increase financial protection by adequately offering cover a myriad illness and diseases. Unlike indemnity health insurance policies that only reimburses your hospitalisation costs, a critical illness rider pays a lump sum amount to insurer on diagnosis of the critical illness /disease that can be used to cover expenses as well as reducing earing capability. Having a robust critical illness rider provides cover which saves you the predicament of dipping into your savings and hard-earned money made over the years.

When it comes to life insurance policy, whether it's a term plan, savings plan or any other, you can only feel completely protected when you not just own a policy but when you have the adequate sum assured to truly protect your family in the case of any eventuality.

The writer is director & chief marketing officer, Max Life