Here are five insurance covers you should buy

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Most of us buy insurance either to do tax planning or when the agent approaches to sell us the policy. We generally don’t think through the importance of protecting our assets and realise the need only when it gets too late. It is important to chart out your insurance needs and buy the plan based on your age and needs.

Here are five insurance covers you should have in your portfolio:

— Health Insurance: The first layer of protection should be a health insurance policy for you and your family. A family floater plans protects you and your family in case of sudden hospitalization by reimbursing you medical bills.  If you are young and single you can consider buying an individual policy and as your family grows you can add more members to your policy. Before signing on the dotted lines do not forget to read the policy document carefully so that you understand the exclusions and do not get surprised at the time of making claims.

— Life Insurance: There are several kind of life insurance policies ranging from endowment, unit linked insurance plans to term policies.  Unit linked and endowment plans offer the combination of both insurance and investment. On the other hand term insurance plans offer complete protection and are much cheaper to buy. A 35 year old can buy a term insurance of 50 lakh for around Rs 15,000 to Rs 20,000.

— Personal Accident Cover: This is one of the cheapest policy and offers you protection of income in case of any disability. The policy covers is recommended to individuals as it covers not only accidental death but also disablement, leading to loss of earning capacity, at affordable premium rates.

— Motor Insurance: A motor insurance policy has two components-own damage and third party cover. Own damage policy covers the damage to your car while third party insurance, as the name suggests, covers third party liabilities. Third party cover is mandatory in India, and often to cut the cost people buy just the third party cover. Experts say it advisable to go with the comprehensive cover which protects both your car and the third party risks.  Moreover, in the last decade insurers have come out with add on covers such as zero depreciation and engine protection covers, which take additional care of your cars.  The cost of every add on is added to normal OD premium, increasing the cost of premium of own damage insurance cost goes up.

— Home Insurance: Home insurance covers three kinds of risks. The basic policy protects the building against fire and allied perils such as earthquakes and floods. The second type of risk coverage protects the contents of your house from both natural and man-made calamities, including burglary. There are policies that also cover fine arts and contents kept with children living outside for the purpose of the study. The third covers peripheral risks such as baggage, increased living expenses, among other things.