When it comes to building a strong financial portfolio, most people focus on savings, investments, and growing our wealth. While these are important, one crucial aspect often overlooked is protection. Life has a way of surprising us, and not always in good ways. No matter how well you plan your finances, an unforeseen event such as a health crisis, accident, or damage to your car or home can derail your financial goals. That's where insurance steps in-not as an expense, but as a shield that safeguards your wealth and secures your family's future.

Having the right set of insurance policies ensures that you are not forced to dip into your savings or liquidate investments during emergencies. Instead, your insurance acts as the safety net, quietly sitting in the background until you really need it, allowing your financial plan to stay on track.

1. Term Life Insurance - The Foundation of Financial Security

If you are the main income earner (breadwinner) of your family -meaning if your family depends on your income, then term life insurance is a must. It provides pure life cover-meaning in case of your untimely demise, your family receives a lump sum amount (or regular income or both) to meet expenses, pay off liabilities, and continue their lifestyle. You pay a premium for a specific "term" (e.g., 20 or 30 years), and if you pass away during that period, the insurance company pays the claim. Without it, your family would be left to navigate a difficult emotional loss while also facing a financial crisis.

Why it's essential:

·         Provides financial security to your dependents in your absence.

·         Affordable premiums for high coverage.

·         Helps cover long-term goals like children's education or marriage.

Always choose a life cover amount that takes care of all your liabilities, future goals & income replacement in your absence.

2. Health Insurance - Protection Against Rising Medical Costs

Medical expenses are rising at an alarming rate. Even a few days in the hospital can cost lakhs of rupees. Health insurance ensures that you don't have to dip into your savings to pay huge hospitalisation bills. A comprehensive health insurance policy acts as a shield, covering expenses like hospitalization, doctor's fees, surgeries, and medicine.

Don't assume your employer-provided health insurance is enough; it may not be sufficient or have limitations like co-pay, cappings, etc; and is tied to your job. Having a personal policy ensures uninterrupted coverage, regardless of your employment status.

Why it's essential:

·         Covers hospitalization, surgeries, and treatment costs.

·         Prevents financial setbacks during medical emergencies.

·         Access to quality healthcare

·         Cashless benefit

Don't just look at the premium-get adequate coverage, exclusions, network hospitals and consult your insurance sales person.

3. Health Insurance for Parents - Caring for the Ones Who Cared for You

Caring for aging parents is a financial and emotional responsibility. As your parents age, their medical needs may increase, and so does the cost of healthcare. People make the mistake of including their parents in a standard family floater plan, which might not offer adequate coverage for age-related ailments and could significantly increase the premium for the entire family.

Having a separate health insurance policy for your parents is crucial. By securing this policy, you're not only protecting them but also preventing a financial drain on your own savings.

Why it's essential:

·         Covers age-related illnesses and frequent medical needs.

·         Helps avoid large out-of-pocket expenses for their treatment. Reduces the financial burden on you when your parents need treatment.

·         Gives peace of mind knowing their healthcare is secured.

Buy these policies while your parents are younger and relatively healthier. The earlier you buy, the fewer exclusions and the lower the premiums. By purchasing a policy early, when you are less likely to fall ill, you can serve the waiting periods without any urgency or financial stress.

4. Personal Accident Insurance - Financial Safety in Case of Disability

While life & health insurance cover death and medical treatment, there remains a gap for accidental disability. Accidents can happen anytime, anywhere-at work, on the road, or at home. If an accident leads to a temporary or permanent disability, you could be unable to work, resulting in a loss of income. A personal accident policy provides financial support in such cases.

A PA policy provides a lump sum amount in the event of accidental death, total permanent disability, or partial permanent disability. Some plans even offer a weekly payout for a period of temporary total disability, which can help cover your daily expenses while you're recovering.

It's a critical safety net that ensures your financial life doesn't come to a halt just because an unexpected event has rendered you unable to earn.

Why it's essential:

·         Covers both death and disability due to accidents.

·         Provides compensation for income loss during recovery.

·         Affordable premiums compared to the coverage offered.

Ensure your policy covers partial and total disabilities, along with income replacement benefits.

5. Vehicle & Property Insurance - Protecting Your Assets

For many of us, vehicles (car / bikes) and property (home / shop) are the biggest assets after investments. Accidents, theft, natural disasters, or fire can cause significant financial losses if you're not covered.

These policies ensure that you don't have to bear the entire cost of repairs or replacement out of pocket, a financial blow that could easily derail your long-term goals.

Why it's essential:

·         Vehicle insurance is mandatory by law, but comprehensive coverage goes beyond third-party liability to cover your own damages.

·         Property insurance protects your home or office from risks like fire, earthquake, theft, or floods.

·         Provides financial security against unforeseen damages to valuable assets.

Tip: Always opt for comprehensive policies that cover both natural and man-made calamities.

The Role of a Good Insurance Advisor

While understanding these policies is important, choosing the right coverage is where most people struggle. This is where a good insurance advisor or sales person (BQP/POSP) becomes invaluable.

Why you need one:

·         Helps you assess risks based on your life stage, income, and responsibilities.

·         Suggests the right coverage amount instead of simply selling a product.

·         Keeps you updated on new policies, features, and changes in regulations.

·         Guides you during claims-ensuring smooth processing without stress.

Unfortunately, many people buy insurance randomly. The result? Under-insured or misaligned policies that fail during emergencies. A trustworthy advisor ensures your insurance portfolio is both adequate, efficient and the one that really protects you.

Sample Premiums

Conclusion

Insurance is not an expense, it's investing into your future, it's about financial preparedness. By including term life, health insurance (for yourself and your parents), personal accident, and vehicle/property insurance in your financial portfolio, you are setting up a strong safety net for yourself and your loved ones. Pair this with the guidance of a knowledgeable insurance advisor, and you can rest assured that no unexpected event will derail your financial journey.

Your financial plan is only as strong as the protection around it. So, review your portfolio today. Do you have all five? If not, maybe it's time to call your insurance advisor and get that safety net in place.