Joint covers come with reduced mortality charges

Joint covers normally come with reduced mortality charges and you could find such plans in the traditional and Ulip variety. However,if you are looking specifically for term plans,it is recommended that both of you opt for term plans individually with the spouse as the nominee. Annual premiums will depend on factors such as age and health status.

Is the commission paid to agents for selling term plans also deducted from the premium that I pay?

8211; Pramod Mamgian

In a term plan,most of the premium component is the mortality charge. Other charges such as administration and sales-related charges are also built into the premium component. Some insurers offer special rates for women and non-tobacco users.

Now that ELSS will not be be eligible for tax benefits from 2012,should I redeem and instead look for something alternative?

8211; Prabhu Kumar Sharma

Regulations and changes will apply prospectively. So,your current ELSS investments will continue to be governed by the contract you have entered into with your fund house at the time of purchase and you need not worry. There are several heads under which you could save tax such as provident fund and insurance plans. Life insurance plans where the cover is at least 20 times the annualised premium are proposed to be exempt from tax at the time of investment,accumulation and maturity in the direct taxes code.

Your investment decisions for tax-saving purposes or otherwise must be based on your specific requirement,risk appetite and investment objectives.

Do we have policies to insure homes against earthquakes? I stay in an apartment and want some insurance against natural disasters.

8211; Raja Awasti

Yes,several general insurance companies offer cover for homes against earthquakes and other natural calamities. Cover could be taken for the structure or the belongings independently or for both jointly.

Does one get any no-claim bonus in motor insurance and how are the rates and valuations of the car calculated by the insurance company?

8211; Surender Kumar Singh

No-claim bonus refers to a discount on renewal premium offered by the motor insurer for a claim-free previous year. The percentage of this discount could go up in case you have not claimed insurance for successive years,but the maximum discount is usually capped at 50. There are riders attached to claiming this and the fine print must be read. There are methods or even a combination of those by which an insurance firm arrives at optimum valuation.

The writer is executive

vice-president,Kotak Mahindra Old Mutual Life Insurance

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