People crave ‘financial security’. The term can mean different things to different people but essentially we understand this intuitively. It is the first step towards ‘financial well-being’.
What people underestimate all the time are the factors that can cause the status of a family to change from being financially secure to being in financial distress. Such disaster scenarios can occur in any family. Yet, our perception of these risks is such that we think the chances of such events happening to our family are very low.
Death of an earning member is a case in point. This is also the most obvious and commonly played-out scenario in India. Life insurance can help the surviving family. Yet, in 90% of the cases, the insurance amount is too small to take care of the families’ needs. I have come across hundreds of cases where the person who died was insured for less than Rs10 lakh. In today’s time, how many months can this sum of money last for a family of four?
