This may sound like an unnecessary question to ask – if you’re paying for insurance, how can you be underinsured? But this is still an important issue to look at. Protection isn’t just about paying a specific amount and receiving a lump sum pay out once you fulfil the clauses or terminate the plan, it’s about ensuring you have sufficient protection from what could happen in life.
Before choosing an insurance plan, you will have to analyse the extent of coverage you will get under the plan. Since there are several kinds of insurance plans available, there is a likelihood of you ending up being insured for some risks and being uninsured for others. For example, while medical plans typically do cover critical illness treatment costs, the high cost of treatment could eat away at your coverage. In the event that future illnesses crop up, you would have significantly less coverage to handle the situation with. But by adding a critical illness rider to your medical plan, you’ll have an extra cover of protection for 36 common critical illnesses. As the lump sum payout from a critical illness rider is not restricted to medical treatment, it can also be utilised for any other financial needs you may have.
So, in order to avoid being underinsured, identify your needs and select a plan that provides the best possible coverage for you!