Life Insurance, or any kind of insurance policy for that matter, is still in its nascent stage in India. With some estimates showing only 3% of Indians to have life insurance and just 1% having non-life insurance policies, it is still an untapped market with huge market potential. Apart from the market perspective, the benefits of having an insurance is still not sold to most people in the country.
There’s a saying often used by the insurance industry which also holds true: majority of the people in the country are just one medical bill away from entering into a perpetual debt or bankruptcy. It is mostly worse when a family loses its bread winner. At least for the latter, there’s an easy way for at least some people. Credit Cards and Debit Cards. That might sound counter intuitive on the first go as the former is often dubbed as a ‘debt trap’ and both the former and the latter is considered to induce people to spend more money than they intend to with the loyalty/reward points, cashbacks, offers etc.
Although true in most cases, many credit/debit card plans also come with a considerable life insurance policy attached to it, despite being limited to accidents which is better than not having any insurance. For eg. State Bank of India offers Personal Accident cover ranging from Rs.2 lakh to Rs.20 lakh depending on the plan.
Here are some the plans from HDFC that range from Rs.5 Lakhs to Rs.3 crores for platinum card holders on international travel if tickets are purchased using that card.
These come with several terms and conditions depending upon the bank which the users are strongly advised to read to take advantage in case of an unfortunate incident. The standard conditions issued by the SBI include that the claim form should be submitted within 90 days of the death of the credit/debit card holder and the card should have been used at least once in 90 days prior to the accident.
Although it is advisable to have a considerable health/medical insurance coupled with a Life Insurance, it is not always affordable for many. Even for those who use credit/debit cards, life insurance may be a tiny bit beyond their reach. For those kinds of families, the accident insurance provided with these cards may prove more than handy in time of need.