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Estimate the amount of money your family will need Develop an estimate of the amount you want to leave behind taking into consideration: your current age, number of family members who will need financial support, if married whether your spouse currently works, and educational needs if you have any children. Also factor in other routine support needs like rent, living expenses, etc (also consider increases in cost of living). Use a spreadsheet or find insurance estimation calculators on the internet that might help you to develop this. Be sure to include your spouse or other family members in this planning effort.

Shop for Life Insurance Policy Options Start by visiting websites of Insurance companies in India like LIC, Tata, Reliance, etc. Develop an understanding of the various types of policies and their terms and benefits. The broad types of policies are: 1. Endowment plans- which fetch a fat packet at the end of the term. 2. Endowment+Whole Life-Plan which gives you the promised amount at maturity, covers you life and pays your family after you. 3. Money back plans- where in you get around 20% of your policy amount back after every 4 or 5 years to be used when needed. 4. Children’s Plans-with the help of which you can plan for your child’s education. 5. Unit plans- wherein LIC invests in stocks ,with caution, on your behalf, at least possible risk to your money. 6. Term Assurance- Last but not the least ‘Term Assurance Plan’ that pays your family,a large amount, in an eventuality for the least amount you pay as premium.

Identify the type of policy you want to buy and estimate payments Other things to keep in mind before finalizing on a policy type are: 1. Any tax advantages that a certain policy might provide you 2. Any bonus offerings on top of the policy amount 3. Cancellation penalties and the waiting period to recover any money Once you have identified the type of policy estimate your monthly payments using the insurance websites to finally settle on the insurance policy that is best suited for you. Also talk to any friends or colleagues or an accountant for recommendations.

Contact an Insurance Company or Agent It is strongly recommended to start with Life Insurance Corporation of India (LIC) as they are 100% backed by the govt. and is the most reliable option. When talking to an agent negotiate for discounts or ask the agent if he is willing to make a few payments on your behalf. Insurance agents get a hefty commission for the 1st year of an endowment or whole life policy and several of them are willing to make 1 or 2 monthly payments on your behalf. Others might offer a gift or some other type of incentive. Contact agents from more than 1 company and negotiate hard and be willing to wait.

Finalizing the Policy and Signing the Paperwork Make sure you read all the paperwork and fine-print and ask for explanations when unclear. Ask the agent to give you all promises for incentives or cash-back in writing. Once the policy is signed make a copy and store the original in a safe place. Congratulations! You have now taken the most important step for securing your family’s future.