Wondering which insurance policies you actually need? Here are 4 must-have insurance covers every Indian salaried employee, family, and business owner should consider.
If you’ve grown up in an Indian household, you’ve probably heard your parents say, “Beta, insurance le lena, zaroori hai”. But when you step into adulthood and start earning, you quickly realize there are hundreds of policies—life, health, car, critical illness, travel—the list is endless.
So, the big question is: Which ones are truly essential?
Let’s break it down with simple, real-life examples.
1. Health Insurance – Your First Safety Net
Take Ravi, a 34-year-old IT professional in Bangalore. He thought his company’s health cover was enough—until his father needed heart surgery costing ₹5.5 lakh. The company policy covered only ₹3 lakh. Ravi had to dip into his savings for the rest.
That’s why having your own health insurance policy is non-negotiable.
- Covers hospitalization, surgeries, and rising medical costs.
- Premiums are relatively affordable if bought early.
- You also get tax benefits under Section 80D (Source: Income Tax Department).
👉 Rule of thumb: Have at least ₹5–10 lakh coverage for individuals, and higher for families in metro cities where healthcare is expensive.
2. Term Life Insurance – Protecting Your Family’s Future
Imagine Amit, a 38-year-old salaried employee with a home loan and two kids. If something unfortunate happens to him, his family would struggle to pay EMIs and daily expenses.
This is where Term Life Insurance comes in.
- Provides a large cover (say ₹1 crore) at an affordable premium.
- Pure protection plan—no maturity benefit, but financial security for dependents.
- Recommended: Coverage of at least 10–12 times your annual income.
👉 Check out IRDAI for guidelines on trusted insurers.
3. Personal Accident Insurance – The Most Overlooked Policy
A lot of us think, “Why do I need accident insurance if I already have health and life cover?” But here’s the reality: accident-related disabilities can disrupt income even if you survive.
Example: Suresh, a self-employed trader in Lucknow, survived a road accident but couldn’t work for almost a year. His personal accident insurance gave him a lump-sum payout that kept his household afloat.
- Covers death or disability due to accidents.
- Premiums are very low (often less than a family dinner).
- Ideal for people who commute daily or travel frequently.
4. Critical Illness Insurance – For Lifestyle-Related Diseases
India is sadly becoming the diabetes and heart disease capital of the world. Even young professionals aren’t spared.
Take Neha, a 29-year-old marketing executive. She was diagnosed with early-stage breast cancer. While her health policy covered hospitalization, her critical illness plan gave her a lump sum on diagnosis. She used it to take time off work and focus on recovery.
- Covers major illnesses like cancer, heart disease, kidney failure, etc.
- Provides a lump sum to cover not just medical bills, but also income loss during recovery.
Quick Recap – The 4 Must-Have Policies
- Health Insurance – Protects against rising medical costs.
- Term Life Insurance – Secures your family’s future.
- Personal Accident Insurance – Covers accidental disability/income loss.
- Critical Illness Insurance – Extra shield for lifestyle diseases.
FAQs on Insurance Policies in India
1. Isn’t my company-provided health insurance enough?
Not always. Company policies may end when you switch jobs or retire. Always have a personal cover.
2. What’s better—Term Plan with returns or Pure Term Plan?
Go for a pure term plan. It’s cheaper and gives higher coverage. Investment and insurance should be separate.
3. Do I need both Health Insurance and Critical Illness cover?
Yes. Health insurance pays hospital bills, while critical illness gives you a lump sum to cover income loss and other expenses.
4. What’s the right age to buy insurance?
The earlier, the better. Premiums are lower when you’re young and healthy.
5. Should business owners buy different insurance policies?
Business owners should definitely add professional liability and business insurance, but the 5 policies above are must-haves for everyone.
Conclusion
Insurance may not be the most exciting topic to discuss over chai, but trust me—it’s one of the most important financial shields you can build. These 4 must-have insurance policies ensure that no matter what life throws at you, your family’s financial future remains protected.
👉 Share this with a friend who keeps postponing buying insurance. It might be the push they need.
Next on iMoneyMatters: We’ll dive into “How Much Health Insurance Coverage is Enough for Indian Families in 2025.” Stay tuned!