Life Insurance Policy in 50s: Why & How?

Life Insurance Policy in 50s: Why & How?

By Mr.Sanjay Tripathy, HDFC Life.

After making sure your children are taken care of, it is time to start thinking about your future.

Your employment years are nearing an end, making you feel wary of the looming income-less years. 

But, this should not be the case. Instead of depending on your children, it is better to make sure you are financially independent and are able to continue living the life you are used to.

You must have heard that life insurance in your 50s is expensive as you will have lesser number of years to accumulate a corpus.

Diabetes or / Hyper tension..!

Moreover, health can be an issue as most of you may be hit by diabetes or / hyper tension etc. Life insurance plans are cheap for young and healthy people.

Most of you in your 50s tend to already have a financial portfolio in place, which would definitely include some insurance plans. It is time to review the old plans and check out if you are on track.

If you have invested in market-linked life insurance plans with 100% exposure to equity, you have to sit down with your financial planner & decide if it now requires shift to debt fund. This would ensure that your corpus is protected from the volatility of the market as you are nearing your pension years.

Sanjay Tripathy, HDFC Life.

Many of you must have bought financial assets to take care of your child’s higher education, to protect your family from home loan liabilities etc. In your 50s, you must ensure that you have a pension plan in place.

After making financial decisions all your life, why would you suddenly want to give it up? Pension plans from life insurer ensures that you receive a monthly income while you are still living, enabling you to maintain the same life style as earlier.

Save on income taxes..!

Now that you are done with most of your responsibilities, you may still wish to leave a financial buffer for not just your children but also your grandchildren. Life insurance helps you to leave an inheritance and save on taxes.

In many ways life insurance can work as estate equalisation of your wealth amongst your family members.

This is the age where you are more prone to health issues and therefore it makes good sense to get a comprehensive health insurance that covers both your life as well as your medical expenses.

Nowadays, even funerals tend to be a costly affair. Life insurance helps you to avoid leaving this financial burden on your family.

Through a life cover, not only will they get a lump sum amount in the event of your death, but also a regular income over and above it. Thus, your family members will have to incur no additional expense for the funeral.

Pension & Annuity plans..!

An exclusive category of products offered by life insurance companies in India is retirement solutions, which is a culmination of two phases – accumulation phase when you build your retirement fund by investing in a pension plan before retirement and redemption phase in the form of regular and guaranteed income for life post retirement through an annuity plan.

Pension and annuity plans should never be looked at in isolation. They are two sides of the same coin.

A combination of these two plans is a good investment avenue that takes care of longevity risk, i.e. risk of us outliving our savings.

Health plan..!

First and foremost, you must opt for a comprehensive health insurance plan that can adequately cover any emergency medical situation. The sum insured should take into consideration the growing inflation and its effect on medical expenses and the location of your residence.

Look for cashless schemes. These refer to plans that have tied up with hospitals around the country to allow you to hospitalise without any cash requirement from your end. Instead, these hospitals get directly paid by the insurance company for all the expenses that you have incurred.

Opt for a plan that not only covers basic hospitalization bills, but also the after care that will be required. Look for those plans that offer a multiplier benefit, which doubles your cover after two claim-free years at no extra premium.

Term plans..!

These are the simplest life insurance plans available in the market. They only offer life cover and, in some cases, a monthly income over and above the Sum Assured, in the event of your death.

In your 50s, you must be cautious of where you put in your money. 

Your hard-earned money should be invested wisely for your future. A visit to a certified financial planner is advisable to guide you in your financial planning exercise.

About the author..

The writer Mr. Sanjay Tripathy is senior EVP, Product, Digital & Ecommerce, HDFC Life.

Mr. Sanjay Tripathy Senior Executive Vice President, HDFC Life Mr. Sanjay Tripathy is Senior Executive Vice President, Marketing, Product, Digital, and Direct Channels, including E-commerce and member of the Executive management Committee at HDFC Life. 

His core responsibilities are managing Direct Channels, E-commerce, Marketing and Product Strategy, Brand Planning, Advertising, Communication & Media, Customer Insights, Online and Digital Strategy, Customer Analytics, & Corporate communication. Sanjay is credited for establishing HDFC Life as a strong and distinct brand in the insurance category through ‘Self Respect,’ the core brand proposition. 

Sanjay Tripathy, HDFC Life

The brand re-launch in FY2010-11 has helped reposition HDFC Life as a contemporary and dynamic brand. He is also credited for establishing two best-in-class sales channels (Direct and Online) in the industry. He has been instrumental in designing innovative products in the industry including Smart Woman, India's first ULIP for woman, and Click2Protect, a highly competitive online term plan. He started his career with GCMMF Ltd. in 1992. 

Since then he has worked with various reputed organizations like Frito-Lay (PepsiCo), Mattel and Reliance Communications (erstwhile Reliance Infocomm) before moving on to his current role at HDFC Life in 2004. Some of his major contributions include launching Dhara at GCMMF, setting up of Frito-Lay's business in the East, building Mattel's business in India. 

At Reliance Communications, he was instrumental in launching the Dhirubhai Ambani entrepreneur programme and the Reliance IndiaCall (international calling card) in USA, Canada and UK. Sanjay has featured in Campaign India ‘The A list 2009, 2010, 2011, and 2012’ of most influential people in Media, Marketing and Advertising apart from winning several other awards. 

He is a management graduate from IRMA and is a Board Member at Media Research Users Council (MRUC), an Advisory Board member at DMAi (Direct Marketing Association - India) and a member of the Awareness Subcommittee of the Life Insurance Council.

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