We often blurt out an old but a true adage, Health is Wealth as friendly advice. Without realising its importance ourselves, the phrase becomes our signature response to one and all. But self-realisation occurs only when life strikes you hard; when on an unfortunate day, either you or a loved one ends up on a hospital bed. The family’s pain becomes worse if they are unable to arrange the money demanded by the hospital. Family members end up taking heavy debt or mortgage property for monetary support. Some resort to redeeming their investments and fixed deposits midway, which could have secured their future expenses for child education, weddings or would have served as retirement funds. Given our fast-paced lifestyles, serious ailments (cardiac arrest, liver failure or lung, and kidneys diseases) can affect even the healthiest of us all, irrespective of age. Whether in your ’20s or ’60s, you are at equal risk to fall prey to severe diseases. Thanks to our stressful lives! How we wish that we never have to face such a reality that bites. Since the future is beyond our control, we ought to be prepared for the unforeseen and ensure that our future plans don’t go haywire or our families don’t go through the ordeal. So, are you prepared to bear the cost of unexpected medical packages that run into lakhs? A medical or health insurance can keep you covered for the rest of your life. You can understand and learn about Medical/Health Insurance through our simple Q & A’s.  Q) Why should you get an insurance cover at the earliest? How much does medical/health insurance cost? A) It’s best to get medically insured in the age group between 25-35 years, as the premium costs are low and generally no health check-ups are required by insurance companies at the time of policy initiation. Total Premium for a basic cashless INR 10 Lacs medical cover for a 30-year old man with a 27-year old wife should cost around INR 10,000 - 11,000* for 1 year. Paying a 2-year premium together gets you a 10% discount on the policy premium. If you add features like out-patient treatment and maternity benefit, then the premium will increase to INR 20,000 - 22,000* per year. The premium can be easily compared online. All the insurance policies can be purchased online directly from the company’s website. Detailed comparison and analysis of the plan feature, price and terms & conditions should be done before buying any insurance policy. (* Prices are indicative based on a leading insurance company’s online quotation) Q) Paying premium each year or every 2 years. What works better? A) If you plan to get married, have a baby, or want to increase your sum insured soon, yearly premium payment is the best option as an addition to a policy can be only made at the time of renewal. Otherwise, opt for 10% discount by paying a premium for 2years if your budget permits. Q) Do I need medical insurance; my family and I are protected under the company’s group health insurance? A) In case you are insured under a company’s group health insurance, it is still vital to have your personal health insurance. A medical emergency may arise at a time when you have resigned from your job (or get fired) or you are on a sabbatical/between jobs. Nobody knows the future. Q) How should I decide which insurance company to go for? A) You should do the following -

1. A thorough comparison of the policy features (both inclusions and exclusions) needs to be done to ensure an apples-to-apples comparison. Inclusion or exclusion of features like OPD coverage, Maternity Cover, Policy-restore benefit, Ambulance charges, Daily Cash, Donor charges, etc can be evaluated based on the requirement.
2. Network Hospitals: Higher the better! Good hospitals which are closer to home & office should be there on the list.
3. Evaluate the claim settlement ratio – Again, higher the better!
4. Room-rent sub-limits – It has become important to look at the per day room cost levied by the hospitals these days.
5. Renewability – Lifetime is better!
6. Insurance companies with dedicated team for claim settlement rather than third-party outsourcing.
7. Check for online reviews – i.e. customer feedbacks and complaints online.

It is extremely important to make full disclosures w.r.t pre-existing illnesses, family health history, and smoking/drinking habits. Any false disclosure can become a reason for the rejection of the claim by the insurance company.  So buy adequate health insurance coverage and keep your family & your life savings safe.Kushal BhatejaProgram Head-Financial Analysis

While most professionals are juggling between work and life, WORK-LIFE BALANCE has come to the verge of impossibility in life. Even though many companies have significant work-life balance policies, such arrangements are largely in experimental stage only. Many global leaders asserted the concept of Work-Life Balance as a path-breaking initiative for employee well being. According to Jeff Bezos –Chief Executive Officer, Amazon stated “work-life balance is a circle; it's not a balance. And I think that is worth everybody paying attention to it.” He further highlighted "If you shortchange your sleep, you might get a couple of extra 'productive' hours, but that productivity might be an illusion." With respect to work-life balance, Amit Aggarwal – Senior Vice President also added – Amazon India sent out an email to his team to stop replying mail post office hours. This is said to be a very significant initiative focusing on work-life balance by any major brand. Despite many initiatives across the corporate, a survey conducted by Monster.com (2019) revealed that 60% of professionals have rated their work-life balance hugely deranged. The highly competitive work environment and do or die situations have become a trend in corporate culture. Strenuous working hours, taking office work to home often, working on the weekends, etc are becoming unofficial parameters of employee’s performance metrics. The impact of such imbalance leads to anxiety, hypertension, fatigue, back problems and frequent headache, which further effects employee’s productivity. Due to these reasons, companies are coming up with more work-life balance initiative for well being of their human resources. Here are a few tips to manage work-life balance:• Negotiate with your rewarding performance – most of the company offers flexible work option to employees with consistent performance, so strive for efficient and productive performance to avail such benefits. • Talk to the manager – Better to communicate your family exigency & commitment with managers or management, and get their full support. • Learn to say “No” –The timely deliverables is the key to work-life balance, stretching the work commitments and staying back for long hours are no more the attribute of productive employees. Try to say “no “for the unrealistic target and focus on the timeline. • Family time – Work life can only be manageable if there is a clear line drawn between family and work. You should always keep your personal life aside, taking work at home may burn out your family time. Always prioritize your family and work requirements accordingly In the end, the right balance comes from our own choice; a small step from both employer and employee’s side can bring productive and more content work-life. So, all we can say is WORK SMARTER, NOT HARDER!!!Soumya Sahadevan Research Associate, ICoFP

International College of Financial Planning organized an in-house session on February 18^th, 2019 at its ITO Campus inviting students from Shri Ram College of Commerce and Mata Sundri College on the topic "Trending Career Opportunities in Finance" by subject expert Mr. Kushal Bhateja, CFA, FRM and Academic Head @ ICOFP. It went out to be a full house with great learning experience for all the participants. A questionnaire round later summed up the session.

Insurance as a word is not unheard, even in the hinterlands of the country. As a concept whether people understand its meaning is a debate which needs a lot of deliberation. Let us focus our discussion on Life Insurance to start with. Most of the people purchase life insurance products for Tax saving and few understand that it’s a cover for life. Second highest category is of the customers are in for investments and somehow buy this product given the first point that we mentioned. Children education, marriages, retirement etc. are also some of the reasons that have been seen empirically. There are two types of Life Insurance Plan: Term plan and traditional plans. Traditional Plans are those which have saving component and risk component. These plans are liked by people but CAGR of these plans around 6%. Among term plans, we have a bifurcation into:

1. Pure Term Insurance Plan
2. Term Insurance With Return Of Premium

Let us discuss each of the above.

1. Pure Term Insurance Plan: A form of life insurance where the insured is covered for a specific term during which if he passes away, the sum assured is payable to the nominee. If the death doesn’t happen, nothing is payable at the maturity of the policy. This plan is the most effective plan to insure life and is very cost efficient.

The challenge with this plan is that people think their money will be lost if they don’t die. There is no maturity value of the policy. This limitation is the genesis of the second plan discussed below.

2. Term Insurance with Return of Premium: As the name suggests, the premium is returned in case the insured is alive at the maturity of the policy. Of course, if the insured passes away while the coverage continues, the sum assured is payable to the nominee.

Let us look at the numbers now. For a person aged 26 years, term 40 years for sum assured INR 50 lacs, premium will cost ~ Rs.12,000 p.a. for the second plan but if one is willing to let go of the maturity value, the premium falls to INR ~6,200 p.a. under the first plan. Let us build on to this. The INR 5,800 of the premium saved for 40 years can be invested into a mutual fund in a SIP which, for this long maturity, can easily generate 10% totaling to Rs.2,823,740 as against the total premium returned which approximate to INR 12,000 x 40 = Rs. 480,000. The mathematics is very clear. But above all, buying any insurance has a lot of emotions built into it. After all, man is an emotional animal.

We often blurt out an old but a true adage, Health is Wealth as friendly advice. Without realising its importance ourselves, the phrase becomes our signature response to one and all. But self-realisation occurs only when life strikes you hard. When on an unfortunate day, either you or a loved one ends up on a hospital bed. The family’s pain becomes worse if they are unable to arrange the money demanded by the hospital. Family members end up taking heavy debt or mortgage property for monetary support. Some resort to redeeming their investments and fixed deposits midway, which could have secured their future expenses for child education, weddings or would have served as retirement funds. Given our fast paced lifestyles, serious ailments (cardiac arrest, liver failure or lung and kidneys diseases) can affect even the healthiest of us all, irrespective of age. Whether in your ’20s or ’60s, you are at equal risk to fall prey to severe diseases. Thanks to our stressful lives! How we wish that we never have to face such a reality that bites. Since future is beyond our control, we ought to be prepared for the unforeseen and ensure that our future plans don’t go haywire or our families don’t go through the ordeal. So, are you prepared to bear the cost of unexpected medical packages that run into lakhs? A medical or health insurance can keep you covered for the rest of your life. You can understand and learn about Medical/Health Insurance through our simple Q & A’s.

1. Q) Why should you get an insurance cover at the earliest? How much does medical/health insurance costs?
2. A) It’s best to get medically insured in the age group between 25-35 years. As the premium costs are low and generally no health check-ups are required by insurance companies at the time of policy initiation. Please refer to the table below* for yearly approximate costs.

  *Premium inclusive of taxes as on 30^th June 2016 for age group 25-35years. Source: Leading general insurer’s website. If you would want to pay 2 years premium, you get 10% discount on the premium amount. Eg: Instead of Rs.7243/- per year, you can pay Rs.13037/- for 2 years for Rs10lakhs sum insured for an adult.

1. Q) Paying premium each year or every 2 years. What works better?
2. A) If you plan to get married, have a baby, or want to increase your sum insured soon, a yearly premium payment is the best option. As any addition to a policy can be only made at the time of renewal.

Otherwise, opt for 10% discount by paying premium for 2years.

1. Q) Do I need medical insurance; I and my family are protected under company’s group health insurance?
2. A) In case you are insured under a company’s group health insurance, it is still vital to have your personal health insurance. A medical emergency may arise at a time when you have resigned from your job (or get fired) or you are on a sabbatical/between jobs. Nobody knows the future.

Scenario 2- If you retire between the age of 55-65years and decide to have a Medical Insurance cover since the Co. group insurance is not active anymore. It might be too late as:

• Insurance company will ask for a thorough medical check-up and exclude the cover for pre-existing illnesses from the Insurance contract. For example - if you have a heart problem, all heart related issues may be excluded.
• Insurance premiums will be too high.

So buy adequate health insurance cover and keep your family & your life savings safe. This is our first article in the trilogy series on Health or Medical insurance. Please visit us again for the next article on types of health insurance products and the best health insurance policies for you. The third and final article will follow soon to discuss exclusions (temporary and permanent exclusions), add-on riders. Their pros & cons and more such relevant information. By Kushal Bhateja

Human life can be unpredictable at times. It is always associated with the factor of uncertainty. This element can bring a good or bad change. Any good change leads to happiness but if it happens to put forth a bad change, life gets affected to a great extent. There may be several reasons for such changes in life. Predominant among them is ‘health’. There is no doubt that a healthy life leads to a happy and cheerful life. A person in good health can enjoy every bit of his/ her life. It relieves any kind of mental stress allowing him/ her to plan for future. With a relaxed mind people can concentrate on the priorities of life. Hence in this way a healthy person can lead a better life. Unlike this an unhealthy individual will live occupied with the thoughts of healthcare. Any sickness can affect the health of the person to a great extent. Unless the ailment is cured the person cannot live stress free. Not only does it affect the physical state of the person but also the mental state. In addition to health worries, today the healthcare is a big challenge. The high medical care cost keeps a majority of people devoid of quality healthcare. The expensive treatment cost goes beyond the budget range of many people. Hence people end up compromising with the quality or else borrow or sell off their precious articles in order to meet the expenses. In such cases people face high level risk in terms of health. Taking care of one’s health is something which is important but there is a need to understand that health insurance is a must for everyone. People wonder why medical insurance is required in life. They don’t understand its significance until they happen to face a health crisis. But by then it becomes too late to recuperate the costs. So it is better to take appropriate measures rather than regretting later. First, let’s take a look at the basic meaning of health insurance. In a layman's term, it's a paid service provided to a person to make sure he is covered monetarily in case he has the need to get medical attention due to disease, accidents, etc. With the rising incidence of diseases and cost of treatment, any illness can mean substantial financial outgo for you and your family. Health insurance allows you to plan for such events without feeling the financial burden of treatment. The general conception about health insurance is that it is relevant to unhealthy people or only to aged ones. There are others who take their health for granted. For such reasons people prefer not to buy a health cover. Unlike this, the truth remains that medical insurance is a relevant product for us all. One needs health insurance at every stage of life, more so when you are older. The best time to take it is when you are young, fit and healthy. Once you have a family, it’s best to have all members of the family covered, even if your children are very young and healthy. It is a tool that makes the healthcare journey comfortable. In addition it gives a sense of security, relieving the insured from the tension of health uncertainties and the related needs. Moreover, it also allows tax saving since the premium that you pay on your health insurance policy is eligible for tax deduction under Section 80 D of the Income Tax Act. (Up to Rs.15,000 for an individual or Rs.20,000 for senior citizen of over 65 years of age). Some people believe that if they are covered by their employer, they don't need to buy a separate policy. This can be a costly mistake. While such covers are useful, they may not be sufficient. If you lose your job or switch to another company, you may be rendered uninsured. For supplementing an existing cover, you can either buy a normal policy or a top up plan. A top-up policy is cheaper because it will cover expenses beyond a certain initial threshold. For instance, Sharma, his wife and child already have a Rs 2 lakh health cover from their employers. They should ideally supplement this cover with a top-up policy. If they buy a normal cover of Rs 5 lakh, their premium will be at least Rs 10,000 per year. However, if they buy a top-up cover of Rs 5 lakh with a Rs 2 lakh deductible, it will cost them only Rs 4,100 a year, a saving of Rs 5,900 per year. Their existing policies can take care of the initial Rs 2 lakh, which won't be covered by the top-up plan. Health insurance is especially important for people not in formal employment. For them, a simple indemnity plan that covers hospitalisation expenses will not be enough. They also need to insure themselves against loss of income due to hospitalisation. Most salaried people get paid medical leave, but if your company does not offer this benefit, a fixed benefit plan comes to the rescue. Self-employed professionals should supplement the base cover with a fixed benefit policy, which pays them a certain amount for the period that they are out of action. Health insurance is the only tool that can provide the financial support to deal with the expenses incurred during healthcare. However, there is not much you can do to shield yourself from the rising cost of insurance. However, you can control costs by making smart choices. Some financial planners suggest that besides health insurance, you should also set aside a corpus for medical emergencies. This option may not always be feasible, but an increasing number of people are opting for it. Their reasoning: if there is an emergency and your policy can't cover the full expense, you have something handy to ensure the best healthcare available. "If you don't suffer from any health problem, the money still stays with you,"

Blog is written by Sonia Ambwani, CFPCM, CFA (ICFAI), Program Manager- Financial Planning at International College of Financial Planning