For the physically challenged or disabled, life itself could be
quite a challenge. From doing daily chores to getting medical care they
require assistance at every step.
Insurance is one ideal way to ensure the physically challenged get
the much needed financial protection for themselves and their families,
to help them lead normal lives like the others. Here are some of the
ways the disabled or physically challenged could get insurance.
Insuring the physically challenged
From visual impairment to mental instability, insurers offer financial cover to the disabled in various forms.
Life Insurance policies
Not all insurance companies permit the disabled to apply for a life insurance policy. A few insurers permit a disabled to directly apply for a life insurance policy, subject to certain conditions. Those partially handicapped and employed can insure themselves with directly on their names. Otherwise, policies could be applied for through a member of the family on whom the disabled is a dependent. A few life insurance policies which the disabled could opt for are from:
LIC’s - Jeevan Anmol 1
Aviva life insurance
Bajaj Allianz
Nature of policies: Life insurance policies that are offered to the disabled are no different from other life insurance policies. In fact even the sum assured remains the same.
Medical Examination: A medical examination would be required mandated to determine the exact nature of handicap and its bearing on the insured.
Premiums :Premiums may be slightly higher. This however depends on the nature and extent of handicap.
General insurance policies
Insurers such as Bajaj Allianz and Oriental Insurance, offer general insurance policies for the disabled. Bajaj Allianz provides a motor insurance policy that offers additional discount for disabled driver’s vehicles and free road side assistance. Oriental Insurance Company offers health schemes for the physically challenged.
Policies for Physically Challenged Dependents
Life insurance plans such as the endowment assurance plan of LIC are designed for the benefit of handicapped dependents. Such plans can be taken by any individual who has a handicapped dependent. The plan provides a life cover to the purchaser and the benefits would be for the handicapped dependent. Benefits under the policy are either in the form of a lump sum amount or as an annuity meant for the maintenance of the dependent. The disability could range from blindness, hearing impairment, locomotor disability or mental retardation or illness. The dependent could be a spouse, child, parents or brother or sister. Premiums under this plan are eligible for a deduction u/s 80DD.Please note that the insured has to be a resident of India. A non-resident Indian cannot claim deduction u/s 80DD.
Disability insurance policies
When we speak of the broad term of disability insurance, it generally refers to the insurance policies that offer protection or cover against risk of any disability occurring due to an accident or mishap. Disability insurance plans are designed to offer financial protection in case of any loss of income if a disability were to occur. Though insurers do not offer a separate insurance policy for disability, such a cover could be opted for along with regular life insurance policies as a rider or as add-ons along with personal accidental insurance policies. These policies compensate you in an event where you become disabled and are no longer able to earn.
Eligibility conditions of life insurance policies for the disabled
In the Finance Bill of Feb 2013,the Finance minister, announced a relaxation in the eligibility conditions for life insurance policies for persons suffering from disability or certain ailments. The permissible premium rate has been raised from 10 per cent to 15 per cent of the sum assured, for policies issued after April 1, 2013. This means, a disabled person would now be eligible for tax exemption even if his premium is 15 per cent of the policy value. Until recently, the deduction under Section 80C of the Income Tax Act in respect of life insurance premium paidwas allowed only if the premium paid did not exceed 10 per cent of the sum assured.
(The author is the CEO of MyInsuranceClub.com, an online insurance price and features comparison portal. You may contact him directly on Twitter: @dyohannan)
Source : The NavHind Times , 22nd Dec 2013
