Understanding Risk. Risk isAn unfavorable event happening A favorable event not happeningRisk taking abilityAbility to pass on risk to a pool (insurance)Ability to absorb risk (wealth creation). Risk In Your Life. As a social animal you face the following risks:Risk of an early death (life insurance)Risk of out-living ones income (pension plan)Risk of illness and health problems to oneself
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1. Risk Mitigation And Wealth Creation Through Insurance THE TECHNIQUES AND PRODUCTS
2. Understanding Risk Risk is
An unfavorable event happening
A favorable event not happening
Risk taking ability
Ability to pass on risk to a pool (insurance)
Ability to absorb risk (wealth creation)
3. Risk In Your Life As a social animal you face the following risks:
Risk of an early death (life insurance)
Risk of out-living ones income (pension plan)
Risk of illness and health problems to oneself & the family (health insurance)
Risk of accident causing loss of life or impairment (accident insurance)
Risk of loss and damage of property (property insurance)
Risk from professional liability (liability insurance)
4. Insurance Classification
6. Wealth Creation Tools Unit Linked Insurance Policy
Unit Linked Pension Plan
Mutual Fund SIPs
Insurance is an ideal investment choice for many due to
Added risk cover
7. Life Insurance Product (Risk Mitigation) Term Insurance
Provides death cover only.
Benefit comes to the nominee only in case of death of the holder
The premiums are very low
This is an ‘expense’ similar to ‘motor insurance’
Term Insurance policy convertible to whole life or endowment plan
Term Insurance with increasing sum assured
Term Insurance with decreasing sum assured – for mortgage loans protection
8. Life Insurance Product (Risk Mitigation) Whole Life Insurance
Covers the risk of death of insured, whenever it may happen, i.e. for the whole life
“The Term Insurance for the longest term”
Premium rates low but higher than Term Insurance
Pure Whole Life Insurance – premiums payable continuously throughout the life
Limited Payment Whole Life Insurance – premiums payable for a limited and shorter period
9. Life Insurance Product (Wealth Creation) Endowment Assurance
Provides ‘death cover’ to the insured during the policy period; and survival benefits at the end of the policy period
Premium rates are high
Money Back Plan
Endowment Plan for marriage/education
Endowment Plan with/without profit
Endowment Plan with double/triple risk cover
Unit Linked Endowment Plan
10. Life Insurance Product (Wealth Creation) Unit Linked Insurance Plan
The savings (investment) component of the policy premium is invested into the financial market instruments to avail a greater rate of return than from traditional insurance policies.
Return on investment linked to the financial market
Investments can be made into equity (asset appreciation), debt (regular income), or money market instruments, etc.
11. Life Insurance Product (Wealth Creation) Pension Plan
Provides for a lump sum amount and annuity benefit payments at the stipulated retirement age.
An effective way of contributing to ones own retirement benefits
Helps in achieving financial independence for ones “Golden Years”
An built-in life insurance cover, as an option
Unit liked pension plans also available
12. Life Insurance Products continue.. Special insurance Plans
Children Policies: To provide for expenses (lumpsum/recurring) related to education , etc. of children or for the benefit of disabled children, in the event of death of the parent.
Joint Life Policies: Provides risk cover on ‘either or survivor basis’. During policy period, on death of one life, sum assured paid to the second life, and subsequent premiums waived, but the risk cover on second life continues.
13. General Insurance (Risk Mitigation) Health Insurance
Why Health Insurance: It covers the expenses incurred towards the hospitalization, medicines and treatment for disease/illness for oneself and the family. Health Insurance provides for the unforeseen medical bills that would otherwise be a burden on the hard earned savings
Mediclaim insurance policies
Overseas Mediclaim insurance policies for travel and
Special Mediclaim Policies covering pre-existing
diseases, etc. (for additional premium)
14. General Insurance (Risk Mitigation) Accident Insurance
In case of death of the insured person due to an accident the Sum Insured is paid to his/her dependants
Also if the accident results in the total/partial disablement, either temporary or permanent, the sum insured is payable in the case of a comprehensive accident cover policy
Accident cover also available as a rider to life insurance policies
15. General Insurance (Risk Mitigation) Property Insurance
Household Insurance: provides for the damage to the house building, premises and the belongings due to natural calamities, burglary/theft, fire, etc.
Motor vehicle Insurance: provides for the “third party liability” that may be caused due to the use of ones four and two wheeler, as well as for the loss/damage to the motor vehicle and injury/death to driver and owner (under comprehensive motor insurance plan).
Travel Insurance: provides insurance cover for loss of baggage, passport loss, medical emergency or accident during travel for work/pleasure.
Shop/Office Insurance: provides insurance cover for the damage/loss to the premises and the contents of the own shop/office.
16. General Insurance (Risk Mitigation) Liability Insurance
Provides insurance cover for the liability that may arise from the practice of ones profession.
A must for professionals such as doctors, lawyers, chartered accountants and others, for risk-free practice of their professions.
17. The Role of KARVY in Insurance Services in India At Karvy Insurance Broking Pvt. Ltd. (KIBPL), we provide both life and non-life insurance products to individuals clients
At KIBPL, tailor-made insurance solutions are provided to the individual clients, that best suit their specific insurance needs and requirements.