How senior citizens should strategise insurance buying

How senior citizens should strategise insurance buyingLifestyle changes with age and so does aspirations. In this case, you have to take a special review of your insurance portfolio, especially after 50 years of age. There are many people who buy different types of insurance policies during their young age. That’s good and it helps in developing a sizeable corpus along with protection against risks.

Nonetheless, after the age of 50, life brings forth many more complications besides the physical feebleness. Retirement issues haunt the mind and responsibilities that have not been fulfilled yet rob most of the space in the life. Since you have spent all your lifetime in procuring the assets and securing your future, you should take care that your belongings are not left astray to various uncertainties. At the same time, it is imperative that you protect yourself and take care of your health to spend the remaining life happily.

Here are a few tips on what should be considered after the age of 50 to optimise the insurance portfolio without losing on any financial aspects.

Health insurance: During old age, you require due care and attention to your health. After 50 years of age, you can focus more on a comprehensive health insurance plan. You might wonder whether or not insurance companies in India offer health insurance to people above 50 years. The answer is: yes.

Until a few years ago, insurance companies were reluctant to provide health insurance coverage to people above 50 years. But now it is different scenario. In 2009, the Insurance Regulatory and Development Authority (IRDA) categorically asked insurance companies to extend health insurance coverage to people up to 65 years.

The regulator also prevents refusal of health insurance services or undue charging of premium amount due to old age.

There are companies which have specific health insurance plans for people above 50 years age. In fact, many offer coverage against pre-existing conditions and provisions without medical tests. Amount of premium is indeed higher in such cases but that ensures a complete peace of mind.

Some plans also offer additional riders such as provision of medical reimbursement for tests as well. As per the IRDA ruling, the amount of reimbursement in such cases should not be less than 50 per cent.

Life insurance: If you think very logically, you will realise that life insurance is meant to replace policy holder’s income in case of death. It may sound brutal but going by this rationale, you may think of reducing your investment in life insurance premium to an extent which is bare minimum. This amount should be able to provide necessary support to your dependents. Over that, you can invest more in regular income producing instruments.

Naturally, these instruments could be insurance plans that provide a combination of health insurance, life insurance and pension scheme.

You may consider liquidating traditional endowment insurance policy as it may not serve your purpose after a certain age.     

Car insurance: There seems to be no evidence of increase in premium due to the old age of the driver. However, if you have been a responsible driver for quite a long time, insurer may renew your car insurance policy at a comparatively lower rate of premium. If nothing else pays in the old age, experience holds you for what you have achieved in so many years. For the same reason, there are lesser probabilities of you getting into a collision.

Then again, if you have recently got the possession of car and you are new to driving, you should not acquire the car insurance policy in your name in order to avoid the higher premium rate.  But if there is no other choice, insurer may charge higher price against providing you the protection.

You can consider pooling wherever possible, if you need to use car frequently. In that case, you can also prefer other modes of transport. This will not increase the number of miles run by your car and you can ask your insurer to reduce the premium due to the same.

Pension plans: Pension plan is widely used as retirement tool to enhance the savings and increase the financial security during the old age. You must be on the verge of receiving the annuities by now. Even if you do not have any pension plan yet, it is never too late to plan for the future.

You can utilize your savings to acquire a retirement plan. Since you have already reached your age now, you do not need to defer your annuities. Instead, you can pay the lump sum premium for the first and the last time and you are ready to receive annuities as regular monthly income immediately.

A lot of preference is given to senior citizens in India. Moreover, insurance companies have dedicated cells to address the issues of senior policyholders. You just need to keep your insurance documents and birth certificates or related documents handy to smooth out the renewal procedure of existing policies or to make the purchase of new ones an easy task.

This article has been contributed by  The views expressed in this article are that of and are not necessarily the opinion of Old is Gold Store.