Insurance policies can be purchased online after comparing the different policies and then choosing the best one. After the policy is chosen you need to fill an online proposal form, submit the required documents and pay the premium online and the policy is issued.

There are a lot of insurance policies available in the market each of which satisfy similar needs and yet have different coverage benefits and premium rates. The best insurance policy which provides the best coverage features at the lowest premium rates can be found only when the different plans are compared with each other. That is why comparing is necessary before buying insurance policies.

A claim is said to occur when the insured event happens and the insurance company becomes liable to pay the compensation for the financial loss suffered by the insured.

Insurance policies come with a specified tenure. When the tenure is over, the cover provided by the policy stops. To continue the coverage, the policy is required to be renewed. Thus, renewal of an insurance policy means continuing the coverage of the policy for an additional tenure by paying the required renewal premium to the insurance company.

Premiums can be paid through cash, cheque, debit cards, credit cards, net banking facilities and also mobile wallets.

Life insurance plans come in the following variants –

• Term life plans
• Endowment plans
• Money back plans
• Whole life plans
• Child plans
• Unit linked insurance plans
• Pension plans

Health insurance plans come in the following variants –

• Indemnity health plans – individual health plans and family floater health plans
• Senior citizen health plans
• Critical illness health plans
• Disease specific health plans
• Hospital cash health plans
• Top up and super top-up health plans

Yes, life and health insurance plans provide tax benefits. These benefits are explained below –

Life insurance plans –

• Premiums paid for life insurance policies qualify for tax deduction under Section 80C upto a limit of INR 1.5 lakhs
• Surrender benefit, maturity benefit or death benefit received under life insurance plans are tax-free under Section 10 (10D)
• 1/3rd of the pension corpus which is withdrawn in cash is tax-free under Section 10 (10A)

Health insurance plans

• Premiums paid for a health insurance plan for self, spouse and dependent children is allowed as a tax deduction under Section 80D. The limit is INR 25, 000. If you are a senior citizen, the limit increases to INR 50, 000
• Premiums paid for health insurance plan for dependent parents earns an additional tax deduction under Section 80D. This limit is also INR 25, 000 which increases to INR 50, 000 if the parents are senior citizens.

Yes, insurance policies allow a free-look period for cancellation of the policy after it has been bought. The period depends on the type of policy bought and the insurance company.

If the insurance policy is cancelled during the free-look period, the premium paid is refunded back. However, the premium refund would be deducted for the administrative expenses incurred by the insurance company in issuing the insurance policy. Moreover, the insurance cost would also be deducted for the period the policy was in force before it was cancelled.

A group insurance policy is one in which a group of individuals are covered under the same plan. A single insurance policy is issued covering all the members of the group and the policy is called a master policy. Group insurance plans usually come with a term of one year after which they have to be renewed for continued coverage.

An insurance contract is a contract of utmost good faith. As per this principle, the policyholder is required to furnish all the important details about himself which are asked in the proposal form. The insurance company issues the policy on the good faith that the insured has provided every information in the proposal form correctly. If any important information, which affects the risk covered under the policy, is hidden or lied about, the principle of utmost good faith is breached. In such cases, the insurance contract becomes void and the insurance company has the right to reject the claim under the policy.

General insurance policies pay a claim on the principle of indemnity. Indemnity means that in case of a loss the policyholder would be compensated by the insurance company for the actual financial loss suffered. The policyholder would not be allowed to make a profit from the insurance policy.