Insurance (Traditional or ULIP’s) – An ideal solution provider to risk at every stages of human’s life
The ultimate motive behind the launch of each life insurance policies are to provide insurance against the risk of one’s life .Now we all know that needs and risk of a man changes with life stages .Before going in for selecting any insurance products we should understand about the life stages which an individual passes through & then to go for a detailed study about the requirement of different products in each stages . Generally a man passes through 9 stages of life
- Infancy stage – Here in this stage man’s thinking part is mostly negligible. That is here he don’t possess that ability to think and identify his needs and risk he may face ,so though he is exposed to risk he is ignorant of that and so don’t take seriously about the requirement of insurance .May be his risk cover is taken by parents .
- Childhood – Here the child’s mental development starts .He gradually develops the process of learning and inculcating that in his memory and develops his habits ,character and skills accordingly .This stage is the stage of educating oneself by the medium of school .So here comes the need of meeting the fees of school by parents .This result to the development of children plan .
- University years – This stage becomes the vital stage where mental development takes a faster pace . Moreover he is no more dependent on parents mentally may be financially and now he can take his own decision ,identify his own needs and risk .He now work hard to get job in order not to be dependent on parents . Here the need of insurance is higher ,either to meet his education expenditure or to cover his life .Children plan works here also may be attaining the stage of maturity .
- Work without marriage – At this stage he becomes financially independent . Now he works and try hard to earn money as much as possible and meet his expenditure and needs .Slowly with years he develops the feeling to settle down and have partner .As in this stage he has his own hard earned money ,he develop the need to cover his life risk as well as save something for his future .So the concept of endowment plans and money back plans came .Also he need to save his tax ,so insurance for enjoying tax exemption .
- Work with marriage and without children – At this stage he is finally married and settled with his wife . Here his responsibility is to look after his wife .So he need to insure his wife against possible odds that she may face in future . So he develop the need to take insurance of his wife and so the concept of joint life insurance policy .
- Work and marriage with children –Here now he is a father of a child .The same stage which he has passed through long before ago . But now he understands the need of his child and risk which his child may face .So again the need for Children plan .Also In the latter part of this stage(when children are more grown up) he develops the need for pension plan for his own benefit in retirement years .
- Work ,marriage and children left :- This is the stage when his children grows and left the parents because of job ,marriage etc This is the vital stage for everybody’s life. The parents are not fully prepared for this phase .His health deteriorates further and his risk of getting into any uncertainities increases .So if he is having insurance he can handle this phase smartly. Probably his health insurance or life insurance will serve the purpose to meet his medical bills.
- Retirement and normal ability to work –This is the crucial stage of a man’s life .He is no more earning and may become dependent on his children but has the ability to work .Here he approaches the pension age of 65 approximate . Probably his pension plan will work here in the form of monthly pension and so no more he have to depend on children for meeting his
small expenses . Also if at this stage, he suddenly met with any unforeseen circumstances then his insurance plan for his and his wife will work out as medicine for his wife in her latter part of life .
- Pension and lower ability to work :- This is probably the last stage of human’s life .Where he need to take rest more .Here pension plan will work till he is alive .
So in this way insurance act as a medicure for every disease and uncertainties . But the problem is people have a wrong notion for insurance and the result is that in India only 3 % of the vast 120 crore population is enjoying the benefit of insurance .The rest need more and more awareness .To enhance customer’s
requirement of insurance & to lure customers towards insurance ,the concept of ULIP is been introduced (blend of investment & insurance) so that customers get interested to take insurance for enjoying the benefit of investment in different funds .
My point of writing this article is to create an awareness among people about the requirement of insurance (either life or mediclaim) at every stages of life & to understand the benefits which they get at the time of urgency ,may be this benefit is obtained during uncertainties only .
The writer to this article is a finance faculty in Orange city Institute of Higher Education ,Nagpur .She is also a wealth advisor & can be contacted in chandrimas@yahoo.com
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