Naval Goel is Founder & CEO of PolicyX.com, an IRDA approved insurance comparison portal. Before venturing into the field of entrepreneurship, he worked with top companies like AIG in New York as part of their corporate team. He talks to BL Portfolio on his approach to insurance and his portfolio of insurance products.

Tell us about yourself as an insurance consumer and what are the major objectives you wish to fulfil while purchasing insurance?

Personally, the objective behind buying general insurance remains getting coverage for future risks of any nature, at affordable costs. There can be any kind of risk one can face in daily life, thus insurance becomes a necessary investment to protect oneself and their family from those unforeseen risks.

What is your general advice on clubbing insurance with investment such as moneyback, endowment policies?

According to me, clubbing insurance with investment is not a wise idea as the primary job of insurance is to cover the unknown risk.

Insurance plans should be kept separate from investments.

What is the portfolio of insurance products that you own now?

I have car insurance, a term insurance plan, a comprehensive family health insurance plan and separate health insurance for my parents.

What amount do you consider adequate for a health cover? Do you rely entirely on organizational health insurance?

According to me, ₹10 lakh is an adequate amount for health insurance considering the medical costs. For a family floater plan also, I think ₹10-15 lakh sum insured is sufficient, though it also depends on family members. While I had an organizational health insurance, I also invested in personal health insurance to get a wider and comprehensive coverage.

Which add-ons in health insurance are essential according to you? And did you consider any specific critical illness focused cover as well?

These days, comprehensive health insurance is packaged very well such that it covers a large gamut of medical treatments thus I have never felt a reason to include any add-on or invest in a specific critical illness plan.

How did you plan for family elders’ health insurance considering the higher premiums and age cutoffs in some products?

We followed the basic rule of insurance i.e, to buy at an early stage of life to get health insurance of our one’s own choice that too at affordable rates. Secondly, going for health insurance with a deductible, for instance 20% co-payment plans makes health insurance plan for senior citizens affordable.

What is the appropriate income to term-cover ratio?

The term cover ratio actually depends upon the age of the individual, their liabilities and goals. The appropriate term cover ratio for a person between 18-35 years is 20 times as a younger person has a longer life expectancy and responsibilities to cover for, for instance education, house, family and health. Likewise, the term cover ratio for a person between 36-40 years is 15 times and for one 40-50 years of age, is 10 times.

How often do you review the need for increasing your existing term cover?

I believe in evaluating the original term insurance cover amount every 2 years keeping your requirements in mind and understanding how those needs and goals are changing.

Did you encounter any instance of mis-selling?

Not me, but my parents have experienced mis-selling of a term insurance plan. After paying premiums regularly for few years, we realized that it doesn’t serve the end objective. Unfortunately, there was no scope for rectification and thus we had to surrender them and invest in a better-suited plan for them.

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