Sunday, October 31, 2010

Health Insurance :- Key Features & Benefits

The basic benefit of health insurance (also called mediclaim) i.e. covering the unforeseen medical expenses, there are few other features and benefits in most of the products offered in the market. Some of them are listed below:

Family Floater Policies: Most health insurance plans give the flexibility of covering up to 4 members of the family under the same plan with a slightly higher premium than an individual health insurance policy. It gives the flexibility of choosing say 4 or 5 lakhs of cover for the entire family. If one member in the family is hospitalized and uses about Rs. 2 lakhs for his treatment, then the rest 3 lakhs can be availed by others. It is very unlikely that more than 1 or 2 members would require hospitalization in the same year. Hence the family floater serves the purpose whoever in the family falls ill.

Hospitalization Cash Benefits: This benefit entitles the customer to cash benefits for every completed day of hospitalization, which helps him to take care of the increased financial burden incurred at the time of hospitalization, such as loss of earnings away from work and other expenses.

Cashless facility: There is a network of hospitals tied up with each insurance company which accepts the insured’s medical identity card (issued by the insurance company) for providing cashless facility to the insured. Hence either part or entire expenses are covered by the policy and the individual doesn’t need to spend from his pocket.

Pre-hospitalization and Post-hospitalization benefits Some mediclaim policies provide for up to 60 to 90 days of pre-hospitalization and post-hospitalization benefits, i.e. the cost of medical tests, medicines, scans, etc. This is usually provided under maternity benefits and treatments which do not require hospitalization.

Ambulance Charges In most cases the ambulance charges are taken up by the policy and the policy holder usually doesn’t have to bear the burden of the same.

Health check up Some health insurance policies have a facility of free health check-up for the well being of the individual if there is no claim made for certain number of years.

Cover for Pre-existing Diseases Some health insurance policies have a facility of covering pre-existing diseases after 3 or 4 years of continuously renewing the policy, i.e. if someone has diabetes, then after completion of 3 or 4 years of continuous renewal with the same insurer (depending on the plan offered and his age), any hospitalization due to diabetes will also be covered.

No-Claim Bonus Some health insurance policies provide a no-claim bonus. If there has been no claim in the previous year, i.e. if the person covered has not availed any hospitalization benefit, then a bonus is declared; either by reducing the premium or by increasing the sum assured by a certain percentage of the existing premium.

Tax Benefits of taking a Health Insurance Policy Under Section 80D of the Income Tax Act, income tax benefit is provided to the customer for the premium amount till a maximum of Rs. 15,000 for regular and Rs. 20,000 for senior citizen respectively.

Tuesday, October 12, 2010

Take Advantage of Nomination Facilities

Registering a nomination facilitates easy transfer of funds to the nominee on the demise of the investor.
What is a Nomination?
An investor can nominate a person(s) called nominee(s) to whom his/her Mutual Fund Units will be transferred on his / her demise.
Mutual Fund units get transferred to the nominee registered in the folio on the demise of the Investor.
What are the benefits of registering a nomination?
Registering a nomination facilitates easy transfer of funds to the nominee(s) on the demise of the investor. In the absence of the nominee, a claimant would have to produce a host of documents like a Will, Legal Heir-ship Certificate, No-objection Certificate from other legal heirs etc. to get the units transferred. The process is simple if a nominee is registered in the folio.

How can an investor make a nomination?
Nomination can be registered at the time of purchasing the units. While filling in the application form, there is a provision to fill in the nomination details.
Alternatively, an investor may register a nomination later through a form which may be submitted with relevant particulars of the nominee.
The forms are available on the mutual fund websites.
Investors may also request the registrar and transfer agent to send a form.

Can an investor make multiple nominations?
Yes! An investor may make up to three nominations and even specify the percentage of the amounts that will go to each nominee.
If the percentage is not specified, equal shares will go to the nominees.

Can a minor be a nominee?
Yes! A minor can be a nominee. However the guardian will have to be specified in the nomination form.

Can a nomination be changed?
A nomination can be changed and even cancelled. The relevant form should be filled and submitted to the Registrar or Mutual Fund Office.

If an investor has different schemes in a folio, will all units of all schemes be transferred to the nominee?
A nomination is at folio level and all units in the folio will be transferred to the nominee(s).
If an investor makes a further investment in the same folio, the nomination is applicable to the new units also.

Who can nominate and who is eligible to be a nominee?
Nominations can be made only by individuals applying for / holding units on their own behalf, singly or jointly.

Non-individuals, including societies, trusts, body corporates, partnership firms, the karta of an HUF, and the holder of a power of attorney (POA) cannot nominate.
Nomination can be in favour of individuals, including minors, the Central Government, State Government, a local authority, any person designated by virtue of his office or a religious or charitable trust.

A non-resident Indian can be a nominee, subject to the exchange control regulations in force from time to time.
Source:- The Hindu