Bandhan Life CEO answers consumer query on 'Buying insurance for homemakers'

Q. I am 40 years old. I live with my wife and son. My wife is a homemaker. I want to buy term insurance for myself and my wife, but she does not have any salary slips. How can I buy the policy for her? Are there any special benefits for women in life insurance?

A. It's excellent that you are proactive about securing life insurance for both yourself and your wife. This decision shows a commendable sense of responsibility towards your family's financial security. Ensuring that both of you have adequate coverage is an important aspect of comprehensive financial planning.

The good news is that homemakers are eligible for term insurance, even without an income. Here's how you can secure coverage for your wife:

Income-based eligibility: As the earning member, your income serves as the basis for determining the sum assured for your wife. Insurers typically allow homemakers to be insured for up to 50 per cent of the primary earner's coverage. For instance, if your policy's sum assured is ₹1 crore, your wife could be eligible for coverage up to ₹50 lakh.

Documents required: When applying, you'll need to provide your income proof, KYC documents, and any existing policy details. Additionally, a medical examination might be required to assess health status. Digital tools make it possible to handle most of these requirements online, simplifying the process for you.

Policy options: Choosing separate policies for yourself and your wife will provide more flexibility in terms of managing coverage and adjusting it based on future financial changes. Some insurers offer plans specifically designed with homemakers in mind, acknowledging their vital role in household stability.

Life insurance for women, particularly homemakers, is crucial as it provides financial security in their absence, which could have significant emotional and economic impacts on a family. Recognising this, the insurance sector offers several benefits tailored specifically for women:

Lower premiums: Generally, premium rates are lower for women, which makes purchasing life insurance more cost-effective for families.

Critical illness riders: These are particularly beneficial for women as they cover diseases like breast and cervical cancer, which may be more prevalent. These riders can provide a lump sum payout, which can be used for treatment without impacting the family's financial stability.

Protected payouts: You can purchase your policy under the Married Women's Property Act (MWPA) and nominate your wife and/or children as beneficiaries. By doing this, you can ensure that, in your absence, the benefits are legally bound to go only to your wife and/or children. This legal protection prevents creditors from claiming these benefits in case you have any financial liabilities.
Securing life insurance early in life is not only cost-effective but also an essential part of planning for the future. The younger and healthier you are when you purchase life insurance, the better the rates and the more comprehensive the coverage. Waiting to buy life insurance can result in higher premiums as you age, and health challenges may make it harder to secure coverage.

It is vitally important to secure life insurance for your wife as soon as possible. The benefits of acting now include lower premiums and immediate coverage, which together provide peace of mind and substantial financial protection for the future. By taking this step, you ensure that both you and your wife have the necessary safeguards in place, thus providing a stable financial foundation for your family.