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Disease and Disability-coverage for self-employed: Fact Sheet

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May 24, 2019

As India heads towards new economic beacons of progress and development, increased need for thrust towards entrepreneurship is becoming the reality of the day. Focus now is more on creation of jobs and not on seeking of jobs. This is extremely important for the overall growth of the nation as a whole. With this, the number of self-employed persons is growing at a stable rate and therefore, the financial inclusion for them is also assuming large proportions. As part of this inclusion, it is very essential that the importance of insurance coverage for them and their loved ones is given due priority as well. Being self-employed, there are certain things that impact this coverage. Following are the important factors that must be considered while checking the insurance plans features for those who are self-employed:         

  1. Scope of coverage: The scope of coverage being offered by the term plan must be sufficient for offering total support to the financial goals. The absence of a regular or monthly income does not guarantee the creation of a regular-term savings corpus and therefore, it is essential that the chosen insurance plan must have a fixed savings component as well or in essence, must have the option whereby the flexibility can be extended.
  2. Additional riders: The plan must offer extra coverage over and above the main plan features. Such a plan must offer the benefit of flexible coverage and the policy holder should be choose to purchase additional benefits in the form of riders like partial/total disability riders, critical illness riders, accidental death rider etc. This impacts the payable premiums but the scope of coverage becomes very flexible. These riders may be:
  1. Critical illness: The rider for the coverage of any critical illness.
  2. Accidental death: The rider for the coverage of death due to an accident.
  3. Disability: The rider for the coverage of disability due to an accident etc.
  4. Waiver of premium: This rider gives the option of waiving off the premiums in case disability or diagnosis of a critical illness.
  5. Hospital cash benefit: This rider provides monetary coverage in case of any hospitalization or related emergencies
  1. Facility of one-time premium payment: This is very essential parameter, given the fact that being self-employed does not guarantee a regular, monthly income. The person must thus be able to make a one-time, lump-sum payment of the entire premium amount so that the payable benefits can accrue.
  2. Income Tax benefit: A term plan comes with tax benefits because the payable premiums as well as the main plan benefits (sum assured and the maturity proceeds) are eligible for tax-exemption under Sections 80C and 10D of the Income Tax Act, 1961.

HDFC Life offers HDFC Life Click 2 Protect Life – an online plan that offers extensive financial coverage against the uncertainties pertaining to death, disability and disease.

ARN: EC/06/2017/9792

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Francis Rodrigues Francis Rodrigues

Francis Rodrigues has a decade long experience in the insurance sector, and as SVP, E-Commerce and Digital Marketing, HDFC Life, manages the online sales channel, as well as digital and performance marketing. He has had hands-on experience in setting up sales channels and functional teams from scratch over a career spanning 2 decades.

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Vishal Subharwal Vishal Subharwal

Vishal Subharwal heads the Strategy, Marketing, E-Commerce, Digital Business & Sustainability initiatives at HDFC Life. He is responsible for crafting and ensuring successful implementation of the overall organisation strategy.

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