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FAQs on Life Insurance Basics

Do you need insurance if your not the breadwinner of the family? Not really.

Apnainsurance.com Research Bureau

21 Dec 2007

Do I need insurance if I am not the breadwinner or contributor of income to the family?

No. If you are not the breadwinner of the family and you don't contribute to the family income, you do not need to purchase life insurance.


Should I buy a life insurance policy even if my employer has insured me in a group insurance scheme?

It is always prudent to buy an individual life insurance policy because:

  • The amount of insurance you are covered for may not be a very large sum
  • If your employer decides on cost-cutting, you may no longer be insured
  • If you decide to leave your employer, you may no longer be covered
  • The older you are when you buy insurance the higher is the premium


Must I go through a medical examination when I buy life insurance? Do I have to incur the costs?

This is the part most agents dislike telling their clients or prospective clients about. Usually, an individual buying insurance for a sum of over Rs 500,000 has to undergo a medical examination. However this limit can vary by company. The costs are borne by the insurance company.


Although it appears to be time-consuming and cumbersome process, an insurance company needs to ensure that the prospective client is healthy. The company needs to ensure that the prospect's objective to buy a policy is to genuinely insure against a risk and not a plan to deceive the company.


It is prudent not to alter medical facts; since it can make the entire policy redundant. Even if your insurance agent advises you because it could help reduce your premium cost; do not alter or conceal any medical facts as it could go against your family in the event of a claim.


Let us take an example and suppose you conceal the fact that you have diabetes when you fill your insurance form. After a while, you go through a heart surgery and choose to make a claim under your critical illness rider. The first thing the insurance company does is ask for your medical records and read that you had diabetes even at the time of purchasing the insurance policy. The insurer will refuse to make any payments towards your claim even if the two diseases are unrelated. This is for a critical illness rider where the cost does not even exceed 30 per cent of the premium cost. Imagine in the event of your death, your entire premium payment is a wasted and importantly, your family will not receive any proceeds from the policy making the entire effort of paying premiums a waste.

I already have a health insurance policy. Should I still buy a life insurance policy with the riders?


A health insurance policy covers you for hospitalization costs and post hospitalization for three months. Consider for a moment the enormous medical costs that you might have to incur if you suffered a major injury or were suddenly stricken with a life-threatening illness. The health insurance policy could take care of your hospitalization costs but what about the loss of income? The Critical Illness Benefit rider could help cover your financial losses, while the Hospital Cash Benefit rider could help with your expenditure while you recuperate.