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Insurance for defense personnel refers to a comprehensive set of insurance policies tailored specifically to the needs and risks associated with military or defense service. It provides financial protection for individuals who serve in the armed forces or related roles, recognizing the elevated risks they face, such as injury, death, and mental health
challenges due to the demanding and often dangerous nature of their work. These insurance policies generally cover life insurance, offering financial security for the families of those killed in the line of duty; disability insurance, which provides income or compensation if personnel are injured or permanently disabled; and health insurance, ensuring access to medical care both during and after service. Some policies also include coverage for accidents, particularly those incurred in combat or deployment, and for risks associated with war or terrorism. Additionally, personal property insurance may protect soldiers’ belongings while they are stationed away from home. Veterans’ benefits typically extend coverage after service ends, helping veterans access health care, pensions, and other support. The purpose of this specialized insurance is to mitigate the financial impact of the risks defense personnel face, ensuring their welfare and the well-being of their families.
Insurance for defense personnel refers to a comprehensive set of insurance policies tailored specifically to the needs and risks associated with military or defense service. It provides financial protection for individuals who serve in the armed forces or related roles, recognizing the elevated risks they face, such as injury, death, and mental health challenges due to the demanding and often dangerous nature of their work. These insurance policies generally cover life insurance, offering financial security for the families of those killed in the line of duty; disability insurance, which provides income or compensation if personnel are injured or permanently disabled; and health insurance, ensuring access to medical care both during and after service. Some policies also include coverage for accidents, particularly those incurred in combat or deployment, and for risks associated with war or terrorism. Additionally, personal property insurance may protect soldiers’ belongings while they are stationed away from home. Veterans’ benefits typically extend coverage after service ends, helping veterans access health care,
pensions, and other support. The purpose of this specialized insurance is to mitigate the financial impact of the risks defense personnel face, ensuring their welfare and the well-being of their families.
Insurance is a contract in which the individual or an entity gets the financial protection i.e reimbursement from the insurance company for the damage caused to them or their property. The insurer and the insured enter a legal contract for the insurance called the insurance policy that provides financial security from the future uncertainties. In simple words, insurance is a contract, a legal agreement between two parties, i.e., the individual named insured and the insurance company called insurer. In this agreement, the insurer promises to compensate for the losses of the insured in case of untoward happening. The insured, on the other hand, pays a premium in return for the promise made by the insurer.
There are two broad categories of insurance:
Life Insurance – The insurance policy whereby the policyholder (insured) can ensure financial freedom for their family members after death. It offers financial compensation in case of death or disability.
While purchasing the life insurance policy, the insured either pay the lump-sum amount or makes periodic payments known as premiums to the insurer. In exchange, of which the insurer promises to pay an assured sum to the family if insured in the event of death or disability or at maturity.
Depending on the coverage, life insurance can be classified into the below-mentioned types:
General Insurance – Everything apart from life can be insured under general insurance. It offers financial compensation on any loss other than death. General insurance covers the loss or damages caused to all the assets and liabilities. The insurance company promises to pay the assured sum to cover the loss related to the vehicle, medical treatments, fire, theft, or even financial problems during travel.
General Insurance can cover almost anything, and everything but the five key types of insurances available under it are
In simple words, insurance is a contract, a legal agreement between two parties, i.e., the individual named insured and the insurance company called insurer. In this agreement, the insurer promises to compensate for the losses of the insured in case of untoward happening. The insured, on the other hand, pays a premium in return for the promise made by the insurer.
Insurance gives benefits to individuals and organizations in many ways. Some of the benefits are discussed below
Insurance aims to provide financial protection to an individual, one’s family and assets from unfortunate eventualities such as death, accident, illness, etc. or loss of assets. A classic insurance policy, i.e. a term plan, provides financial assistance to your family in the unfortunate event of your death. In addition to that, modern day insurance policies have evolved to help you to build your corpus of wealth, plan for retirement, protect your house and personal belongings, reimburse medical expenses, hospitals bills, etc.
As a thumb rule, it is recommended that you have 10x of your annual income.However, you need to evaluate the requirement on a personalised basis based on the income, expense pattern, household requirement, number of dependents, key financial goals, debt obligations etc.
Premium payments can be made annually, quarterly, semi-annually, or monthly as per your convenience. Some life insurance plans also have a one-time premium payment option as well.
The premium is a function of age, gender, lifestyle, occupation, sum assured, medical history, genealogy,medical condition/fitness etc.The older you are, the higher the premium. If you have a medical condition or history of lifestyle illnesses running in the family, then the premiums are likely to be high. The premium for an individual with a smoking habit is likely to be higher than that of an individual with a similar profile who is a non-smoker.
A grace period of 30 days (for annual mode) or 15 days (for monthly mode) is allowed from the premium due date, you can make the premium payment within this grace period, and your policy will continue to provide the stipulated benefits. If the payment is not made within the grace period, the policy will be considered lapsed, and all the benefits under the policy will be lost.If you intend to re-activate the policy, you will have to pay the revival premium and undergo the entire revival underwriting process, which could entail medical examination as well, depending on the tenure of the lapse, the total sum assured of the plan, etc.
A tax benefit is available for the premium paid towards any life insurance plan upto Rs 1.5 lakhs for given financial year, under section 80C of the Income Tax Act 1961, subject to satisfaction of conditions mentioned therein. The death benefit is always tax-free in the hands of the nominee.
There are a variety of riders available such as Critical illness riders and accidental death benefit riders, among others, available for help to achieve comprehensive coverage. Critical illness benefit provides a sum assured upon diagnosis of critical illness that is covered under the policy. The premium paid towards this rider qualifies for tax benefit under section 80D of the Income Tax Act, 1961. Deduction of the same is available as under:
Particulars | Family Amount (Rs) | Parents Amount (Rs) |
General deduction | 25,000 | 25,000 |
Additional deduction, if anyone is Senior citizen | 25,000 | 25,000 |
Maximum deduction available | 50,000 | 50,000 |
Accident Death Benefit offers coverage against death due to an accident. The additional premium towards this rider qualifies under section 80C of Income tax India, 1961.
Purchasing a life insurance policy becomes much easier when you are clear about the basic queries. Hope this helps to resolve most of your queries so that you can embark on your journey towards opting for optimal coverage for yourself.
Note- customer must consult with independent tax advisor before investment and before claiming any benefit in Income Tax Return.
Yes, a minor can be the nominee of a policy. However, he or she must have a legal guardian in the form of an appointee.