Term insurance policies provide worldwide coverage

Published in Mint on 3 November, 2015, Written by Abhishek Bondia

Does a term plan have worldwide coverage?
—R. Kurien

Term insurance has worldwide coverage. However, while underwriting, insurers make an assessment of risk. Generally, if you have travelled to certain high-risk zones, they will reject your application. My view is that you should give the information asked for and no more. If you have not travelled to a high-risk country before, find an insurer that does not ask for future travel plans in the application form. Once the insurance is issued, it has worldwide cover.

I want to extend my life insurance cover to include my daughter. Would it be better to get another plan instead?
—Sangeeta Singh

Yes, buy a separate plan for your daughter. Only a few insurance companies offer a dual life insurance plan. Such plans are mostly limited to you and your spouse.
However, if your intention is that your daughter should be the beneficiary if you die, then add her as a nominee in the insurance.


What are the important details required to be submitted if I wish to change or add another nominee?
—Arvind Patel

When you want to change or add a nominee, you need to provide the following details to the insurance company: name, share in insurance benefit, relationship, age and address of the nominee. Insurers may also ask for proof to support all the facts stated above, and require a nomination form to be filled up. If the nominee is a minor, the insurer would require you to declare the name of an appointee for the minor.

I have lost my policy docket. What should I do?
—Sushma Singh

If you have lost or misplaced your policy, apply for a duplicate policy. The rights and privileges of a duplicate policy are the same as that of the original. The process to obtain this may vary by insurer but the broad process is as follows. First, the insured needs to file an advertisement in a daily newspaper about the loss of policy. The insured then needs to submit a copy of the newspaper with the advertisement along with an application for duplicate policy issuance, an indemnity bond, charges for preparation of a duplicate policy and stamp fees.
In some cases, insurers waive off the requirement of a newspaper advertisement, for instance, when loss is due to theft. In this case, a first information report (FIR) lodged may be required.


My uncle died about three years ago but we did not apply to the insurer for a claim. Can we do that now?
—Anando B.

You should immediately apply for the death benefit. Please submit documents, including death certificate and copies of the insurance policy. The insurer will ask the reason for the delay. Give them the reason, which could be administrative oversight or that the documents were untraced or that the family was in trauma.

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