Blog – Page 30 – Pradeept Agarwal

Here are 16 Additional Coverage for your Vehicle you never knew

Return to Invoice – The IDV shall be taken as the On Road Price which is defined as Manufacturers’ Selling Price of the vehicle+ Road Tax +Registration Charges as applicable for the class/make a model of the vehicle as supported by the invoice of original purchase issued to you by the insured and documents in support of the charges payable under the head Road Tax and Registration Charges.
Depreciation Waiver – In the case of an accident leading to a partial loss, there will be No depreciation charged on the cost of the parts to be necessarily replaced.
Daily Cash Allowance – Insurance Company will pay you a Daily Cash Allowance in case your vehicle is laid up in an authorized garage/ service station for repairs of accidental damages covered under the Policy and the vehicle is essentially required to be laid up for more than 3 days at the garage.
NCB Protection – In the event of Claim for (a) Accidental damage to the windshield by breakage (b) Theft of vehicle or theft of electronic /electrical/nonelectrical accessories (c) In case you go for repair of a rubber/plastic or fiber part damaged in an accident instead of replacement. Subject to no other claim for damage to the vehicle under the Policy, while determining the renewal premium these claims shall not be counted (taken as not happened) and NCB shall be protected
Loss of Driving Licence / Registration Certificate – In the case where the insured suffers a loss of Original Driving License or the Original Registration Certificate, the Insurance company will provide compensation of up to Rs 500 to obtain a duplicate License or RC.
Emergency Hotel or Transportation Expenses – Insurance company shall reimburse you the cost of expenses incurred for accommodation for an overnight stay and /or those for travel to your place of residence or nearest city on your itinerary. Necessarily incurred in the event of your vehicle meeting with an accident en-route and it is impossible to drive the insured vehicle due to an accident and the vehicle had to be towed or if the vehicle is stolen.
Electrical and Mechanical Breakdown Coverage – In event of an electrical breakdown due to ingress of floodwaters without the vehicle meeting with an accident Insurance company shall pay you to cost of necessary repairs subject to the same not being payable in manufacturer’s warranty
Key Replacement Clause – Covers the (a) Cost (locksmith cost) to replace the locks and keys if the vehicle is broken into or stolen and recovered (b) The labor charge for opening the car if you have lost the keys or (c) Cost of the replacing your car keys which are stolen or lost.
Loss of Personal Belongings Clause – Covers loss of personal belongings viz baggage, clothes, bag, etc belonging to you and your dependant family members from the car by breaking into the locked car by visible means or by any peril as insured under the Motor Vehicle Policy
Tyre Protection Cover – Damage to tyres and tubes are covered only if the vehicle has met with an accident resulting in damage to the tyres and/or tubes.
Engine Protection Cover – This add-on provides coverage towards damages or losses to the insured vehicle’s engine. The add-on compensates you for the replacement or repair of your car’s engine or parts.
Consumable Cover is an add on the insurance coverage that pays for the cost of consumables in Car Insurance required to be replaced or refilled in the event of an accident of your car.
Accidental Injury Compensation for Owner/Family/Driver – While traveling in the insured vehicle the Owner/Family/Driver is covered against the risks of assault or any other bodily injury leading to Death/Permanent total/Permanent Partial disability in any accident involving the vehicle.
Personal Accident Cover Owner/Driver – You are covered 24X7 for an amount of Rs 3 lacs/4 lacs/ 5 lacs/10 lacs against the risks of assault or any other bodily injury leading to Death/Permanent total disability in an accident when you are traveling in the insured car. This is in addition to the restricted Compulsory Personal Accident cover for Owner Driver.
Accidental Hospitalisation for Family – This is a special clause for reimbursement of inpatient hospitalization expenses incurred for accidental injuries suffered whilst traveling in the insured vehicle only. The cover is available as a single limit for all the named family members.
Road Side Assistance – help’s you in times where you need roadside assistance. Whether it’s a small mishap or a flat tyre, a 24×7 roadside assistance cover can help you in times of such troubles, without even accounting it as a claim.

Motor insurance plan is mandatory to protect your vehicle from financial burden in case of any damages. Be careful in choosing the right additional coverages for your vehicle.

3 Amazing Advantages to the Employer

The recent COVID-19 pandemic outbreak and the sky-high costs of treatment are huge stress on most of the business. Group Health Insurance for your employees can be a Saviour.

3 Amazing Advantages to the Employer

Motivated Employees: In today’s scenario, when Covid-19 treatment reached a great height, group health insurance is considered as an added benefit. By ensuring against higher hospitalization costs, employers can motivate their employees.
Helps in Retention of Employees: These days more and more companies have become employee-centric and group health insurance has become one of the most preferred benefits to attract and retain talented employees. The group policies also cover the family members of the employees, making the employees feel more attached to the organization.
Low Cost: Group health insurance policies can be bought at low cost to the employee, as it is like buying in bulk, gives discounts.

Corona Kavach policy is an indemnity plan where the hospital bill gets reimbursed. The coverage as well as the terms and conditions of the policy remain identical across companies.

Sum Insured of Rs 50,000 to Rs 5 lakhs, subject to age limits of one day to 65 years. The policy period can be three and a half months, six and a half months, or nine and a half months.

Why Should We Invest in US Stock Market?

The US stock market is home to some of the largest and robust companies with sturdy underlying fundamentals, who are poised to prosper despite the uncertain future.

Taking your current portfolio into account, an addition of US equities will add stability without sacrificing returns. Investing in global equities as an Indian gives you the opportunity to participate in the growth of global economies. Here are a few reasons why one should invest in US stocks:

Why Should We Invest in the US Stock Market?

Global Exposure – A majority of listed companies in the US are foreign companies that have penetrated the US market to take advantage of a large number of investors and to be where the money is. While being invested in US stocks, actual exposure to the US economy is relatively low. Purchasing stocks from the US market will have you not only be invested in the American market but also in international markets giving you access to the whole world.
Largest and Most Liquid Market – Market Capitalization refers to the total value of outstanding shares of a listed company that can be traded. The US is the topmost country in the world in terms of market capitalization as can be clearly seen in the below-given graph. The market capitalization of the US is nearly five times that of China and fifteen times that of India. The US market is also the most liquid market in the world with more than double trades in the stock exchange as compared with China.
Currency Exposure – When one invests in global stocks they are exposed heavily to currency exchange rate fluctuations. One must take precautions while investing in equities with volatile and unstable currency.In the last decade, the Indian Rupee has depreciated approximately 37% against the US dollar.
By taking this into consideration, we can see how an investor who has invested in US stocks would have seen their returns boosted by the depreciating rupee over the years. India’s economy in comparison to the US is more likely to remain a higher inflated economy, keeping the trend unchanged. Diversification and long term positioning will keep investors in the green and help them benefit from rupee depreciation.
FAANG – Simply put, the acronym FAANG represents five stocks which are Facebook, Amazon, Apple, Netflix, and Google. Traded on the NASDAQ, investors turn to technology companies when they are looking to invest in growth stocks and a large amount of media attention and investors’ portfolios are concentrated around FAANG.
The members of FAANG are so massive and profitable that they generate more than a significant amount of the Gross Domestic Product (GDP) in the US. They currently have a market capitalization of around US$ 3.1 trillion and they make up over 10% of the total value of the S&P 500.
Performance – Since 1990, the US markets have greatly outperformed the Indian markets. The Compounded Annual Growth Rate (CAGR) of the BSE 500 is 7.86% and the S&P 500 is 10.06%.

There is a multitude of opportunities in the US market and analysis shows that the time has come to consider this market to diversify your assets outside the country as well. The US is an economic superpower and its innovative nature offers a competitive edge to its investors. Several factors make the US a highly lucrative market.

In the long run, as an investor investing in US stocks helps with diversification in terms of geography as well as the ability to invest in large companies, the scale and size of which is unavailable locally.

Five Bad Habits That Are Really Good while Investing

Not on Time – This is one of the most common bad habits. But this bad habit can do wonders to your equity portfolio. One thing that even Warren Buffett doesn’t do is to try to time the stock market. A majority of investors, however, do just the opposite, something that financial planners have always been warning them to avoid, and thus lose their hard-earned money in the process.

So, you should never try to time the market. In fact, nobody has ever done this successfully and consistently over multiple business or stock market cycles. Catching the tops and bottoms is a myth.

No News – Staying updated with the latest NEWS is a very good habit but this could help you lose money in the stock market. Breaking news tends you take wrong financial decisions.

There is a lot of information/news flowing around in newspapers, Social Media, TV, Internet. This information/news is so well decorated for you to take instant action. News tends you to forget fundamentals and emphasis recent events.

Staying away from such breaking news can help you stick to the fundamentals and grow money with the stock market.

Lazy Action – When it comes to investing, people often say that the more active you are, the wealthier you can become. However, it acts in reverse when it comes to investment in the Stock Market!

So, if you are too active with your portfolio, you are likely to get fewer returns! Shockingly, laziness will help you to get more returns! Yes, you read that right! Notably, investors should choose this for long term investment.

And what is more, market variations will not hurt your investment gains. Invest in good Stock/Fund and forget is the best strategy.

Being Unfaithful is really a bad habit but this bad habit can lead you to make more money while investing.

People usually hold a Stock/Fund/Lic because that is very old or is gifted by their Parents or Grand Parents.

Investors lose money and opportunity when are emotionally attached to some stock/financial product that is inherited and doesn’t sell them even it is not making money.

A good return paying Stock/Product/Strategy will not always give a return. Being unfaithful with your investment & exiting will open new opportunities.

Do Your Own – Following your friends/family/acquaintances is a good habit that can often lead to wrong financial decisions.

The typical buyer’s decision is usually heavily influenced by the actions of friends/family/acquaintances.

Thus, if everybody around is investing in a particular stock/fund/asset-class/product the tendency for potential investors is to do the same.

But this strategy is bound to backfire in the long run. Stop following the herd and use your brains to do your own.

Like it or not, bad habits are bad for you — mentally, physically, emotionally, and even financially.

While some bad habits listed above are extremely good for your financial portfolio and you need not get rid of them.

7 steps to make Rs 1 crore in the quickest time

How does one become a Crorepati? We have all thought about this one question a lot. Is it really possible to have that number? The answer lies in the equity market, to be more specific in systematic investment plans (SIPs) of equity mutual funds.

7 steps to make Rs 1 crore in the quickest time

Make money, SIP by sip – A SIP is a financial planning tool offered by mutual funds that allow you to invest small amounts at regular intervals over a long period. It also allows one to use the power of compounding to generate big returns in a portfolio.
In the equity market, the general approach of investing is to time the market whereby one tries to buy a stock or an index at a certain level and book profit when it has run up significantly. This approach often leads to common mistakes all investors, who tend to buy high (caused by the exuberance of a bull market) and sell low (due to the hopelessness caused by a bear market).
Start early – Starting your SIP early is the first condition of becoming a crorepati. One needs to start early. This will help the investor use the power of compounding. Especially over a long period, the difference between starting to invest early versus starting late can make a significant difference to your wealth.
What’s the next step? Investors should first chalk out their long-term financial goals to identify how much mutual fund investment one needs to make every month.
Talk to the right guy The next step is to decide on the right fund house and fund. They will be looking after your money every single day till you redeem and, therefore, they are like the coach on who you want to entrust your life’s savings.
Mix it up – SIPs are not just about pouring all the money into the equity market. The mark of a great portfolio is the distribution of risk and diversification across asset classes. One important element in mutual fund investing is the split in asset allocation between equity and debt.
Become the gardener – SIP investing is not about putting in some money and forgetting it, the way Warren Buffett will have you do it. It is more like being a gardener, who looks after his plants almost every day just to ensure weeds are not cropping up. An investor must, therefore, monitor the performance of a SIP.
Taking home the crore – If you have reached this point, you did well. But just investing is not enough, you have to take home all that moolah too. There’s a systematic way to do that, too. Systematic withdrawal plans (SWP) can help you redeem your investment when you hit the retirement buzzer.

Whatever be the case, the investment objective must remain sacrosanct and the investment plan must be made to accomplish the goal within the given time horizon and within a prudent risk framework.

6 things to note before applying for a Home Loan

A home is a place where you not only nurture your family and make memories for a lifetime but is also an asset that adds to your net worth and offers security.

Since property prices are skyrocketing, it may be difficult to acquire a home with your savings alone.

To help you take a step closer to your dream home, lenders offer an excellent financial solution in the form of a home loan.

Key Points to note before applying for a Home Loan

1. Home Loan has Eligibility Criteria

You should be a resident Indian.
Salaried applicants age between 23 and 62 yrs and self-employed between 25 and 70 yrs.
Work experience for salaried 3 yrs and for self-employed 5 yrs.
In addition to this, you are required to disclose sufficient income with which you can repay your loan.

2. Your Credit History

The interest rate you pay on your loan is linked to your credit score. CIBIL score of 750 or more reserves a lower interest rates.

CIBIL score between 750 – 650 has to pay a marginally higher interest rate and below 650 can be a challenge.

3. Compare Interest Rates
The home loan interest rate is one of the key factors that determine the cost of borrowing. Don’t forget to compare interest rates among various banks & NBFC’s.

4. Home Loan requires documentation

KYC documents of the Applicant.
Income proof like Salary slips, Bank statements.
Business proof & Income tax return for the self-employed.
Legal documents of the property.

5. Home loans come with two types of interest rates
There are two types of interest rates on home loans: fixed and fluctuating.

In the case of fixed interest home loans, the interest remains unchanged throughout the tenor of up to a few years until the reset date is reached.

On the other hand, interest rates of floating home loans fluctuate as per the market scenario.

6. Home Loan EMIs increase with longer tenor.
Your home loan EMIs are calculated based on your loan amount, tenor, and interest rate.

It is natural that a high-interest rate adds to the home loan cost, which results in higher EMIs. The length of the tenor also has a significant impact on your home loan.

The longer the tenor, the higher your EMIs will be, as the interest adds on with each month.

Now that you know the important things to consider before availing a home loan, go ahead and compare loans offered by lenders to get the best deal.

Emergency Funds – Why have it, How to Build & where to Invest.

An emergency fund is an essential corpus that you must keep aside to tackle emergencies.

It is a fund that you can fall back on at the hour of crisis or for unexpected and unplanned scenarios in Business as well as your Personal life.

1. How to Build an Emergency Fund? An emergency fund cannot be built overnight but is done gradually.

Set aside a particular amount every month. Soon it will grow into a considerable corpus that you wish to have.

2. How much should your Emergency Fund have? Depending on your income and expenses, an emergency fund can be three to six months of your monthly expenses.

3. Where to Invest in an Emergency Fund? The emergency fund should be parked monthly to a Liquid Fund with no exit load. Don’t forget to put a small portion in a bank account that is available 24/7.

The economic crisis is a vivid example of why an emergency fund can be so important. If you don’t yet have an emergency fund, now is the time to prioritize it.

5 Tips to Buy the Right Fire Insurance Policy

Life happens. Don’t be unprepared. It is strongly recommended to buy a fire insurance policy to cover your business and here are 5 tips which will help you choose the right policy-

1. Buy the right coverage– To ensure you buy the right cover, prepare a list of all the items that you would like to insure.

In case you are the owner of the building, you would have to purchase the fire insurance for its structure as well.

2. Go for high deductible– In the insurance sector, deductible means the amount that a policyholder has to pay before the insurer kicks in.

By opting for a higher deductible, you can lower your premium outgo to a certain extent.

3. Check exclusions– While it is necessary to know what is included in a fire insurance policy, it is equally essential to know what is not.

There are some scenarios when the insurer can reject the claim like when the fire happens due to carelessness or fire happens due to war and allied perils, etc.

4. Adopt preventive measures to cut premium– Just because you have fire insurance, it doesn’t mean you can act carelessly.

Even before issuing the fire insurance policy, the insurer would be interested in knowing what the safety mechanisms which you have adopted in your place are.

Safety rules, like smoke detectors, fire extinguishers, etc., can help you get the low insurance premium rates.

5. Compare before buy– A thorough and detailed comparison of various fire insurance quotes obtained from different property insurance companies can lead you to an affordable fire insurance plan.

All the above factors will help you in choosing the right fire insurance policy, and once you buy the policy, it makes sense to review it at the time of renewal.

In this way, you can ensure that your policy is offering sufficient coverage.

Here is a 7 Step Guide to avoid Fatal Traps in Debt Funds.

Rather than parking your surplus money in a bank account or fixed deposit, Park them in a Debt fund for benefits like higher returns, regular income, high liquidity, low risks, reasonably predictable returns, and the benefit of Indexation.

Debt funds are definitely great investment vehicles if you select them smartly based on your investment objective and risk appetite.

1) Liquidity: Look for the exit option of the fund and avoid close-ended funds. No liquidity when in need of funds can be a pain for your investment portfolio.

2) Investment Horizon: Don’t choose a fund simply because it is offering great returns. It is really important to figure out your investment horizon and then choose a fund with a matching profile. Parking for Long-Term in Liquid fund is not a good idea.

3)Taxation: Debt Mutual Fund comes with indexation benefit when redeemed after 3 years and taxed as per your slab if redeemed before 3 years.

4) Credit Rating: Some schemes may bet on lower-rated papers to generate better returns, but it comes with the risk of losing money. So, if you are a conservative investor, you should opt for high rated papers and invest in lower-rated papers to generate extra income.

5) Interest Rate Movement: Change in interest rates has a big impact on debt schemes. Rising interest rate is bad news for most debt funds whereas A falling rate scenario is a treat. This is because of the inverse relationship between yields and prices of bonds.

6) Brand: Invest with reputed Indian brands such as ICICI, Kotak, IDFC, HDFC, SBI Etc. Avoid new & small fund houses. Why put your hard-earned money in lower brands for mild gain.

7) Fund Size: Large funds can distribute fixed expenses over a number of investors bringing down the expense ratio. Large funds can also negotiate better rates with issuers of debt.