Insurance cover exclusively for women

DNA Money

Insurance for women? Must be a marketing gimmick, one would think. A chauvinist might even ask, "What's the need? I am the earning member, so why increase the premium burden?"

But, there are medical needs specific to women, which could require cash outflows, and it helps take a policy that covers these. Life Insurance Corporation of India's (LIC) Jeevan Bharati is one such policy. In fact, it is the only women-specific insurance plan in the country today, since Birla Sun Life discontinued its Woman First Plan.

A money-back policy with a term of either 15 or 20 years, Jeevan Bharati pays a certain percentage of the sum assured to the policyholder at regular intervals. In case of a 15-year plan, it pays 20 per cent of the sum assured each after the 5th and 10th years, respectively and the balance at maturity. In case of a 20-year policy, 20 per cent of the sum assured each is paid after the 5th, 10th and 15th years, respectively, and the balance at maturity.

The entire sum assured is given to the policyholder if she is detected with the five women-specific critical illnesses. Also, if a policyholder below 41 years gives birth to a child who is detected with any of 8 other listed defects, then 50 per cent of the sum assured is paid out.

What's more, as the child disability benefit cover ceases once a woman turns 41 years, the policy premium reduces accordingly. For instance, if a 25-year-old woman takes a Rs 1 lakh insurance cover for 20 years, then her annual premium is Rs 7,345 until she turns 41 years and Rs 7,085 for the remaining years.

Though one can opt for a sum assured up to Rs 25 lakh, the benefits paid for critical illnesses for the mother are capped at Rs 2 lakh, while those for the child have a ceiling of Rs 1 lakh.

The critical illness benefits are not optional, but built into the product. As a result, the cost of Jeevan Bharati is higher than other money-back products in the market. An Rs 10-lakh policy of Jeevan Bharati would cost a 25-year old Rs 69,650 annually. In contrast, the annual premium for LIC's regular money-back policy for 20 years would cost Rs 61,729, while that for Jeevan Tarang would be lower at Rs 48,220.

In return, the policyholder also gets guaranteed benefits to the tune of Rs 50 per Rs 1,000 sum assured during the first five years of the policy. Bonuses are paid thereafter. Notably, in 2005-06, LIC paid a bonus of Rs 37-42 per thousand sum assured, depending upon the term, on its money-back plans.

Besides, if the policyholder doesn't survive the entire term, the sum assured in addition to the guaranteed addition during the first five years and bonuses thereafter are paid irrespective of the survival benefit paid earlier, which makes the policy all the more attractive.

But, what if you already have a life cover from another insurance company? If you have taken a policy from either Birla Sun Life or Bajaj Allianz, just add the critical illness riders for women that these companies offer to the existing policy. The edge these riders have over Jeevan Bharati is that they cover even primary illnesses such as heart attack, brain tumor, kidney failure, anaemia and arthritis, which women are prone to.

Indeed, according to Mumbai-based gynaecologist Dr Surabhi Dalmia, "Arthritis and anaemia are most common illnesses among women."

Birla Sun Life's Critical Illness - Woman Rider covers 29 illnesses, while Bajaj Allianz's MahilaGain offers benefits for 25 illnesses, apart from paying 30-40 per cent of the sum assured for reconstruction of breasts post breast cancer surgery.