Anand Ranjan: I am planning to buy a family floater plan with Rs 5 lakh cover. Should I go for a plan with restoration benefit or buy a top-up cover?
Anurag Rastogi, Chief Actuary and Chief Underwriting Officer, HDFC ERGO General Insurance, replies:
The restoration or regain benefit acts as a hedge to protect you against unforeseen medical emergencies in case you have exhausted the sum insured and the cumulative bonus (if accrued). But it may or may not cover the same illness for which a claim has been made during the policy period. Hence, you should seek clarity on this feature. If the benefit is available for the same kind of illness, you need not buy a separate policy, and terms and conditions, as well as the waiting period, will remain the same. A top-up serves as a contingency plan and works in conjunction with your current policy so that it can be topped up to provide a larger coverage at a much lower premium. In this case, you should carefully select the cover, keeping in mind the aggregate deductible (the threshold limit which you either pay through an existing policy or out of your own pocket). Ideally, a super top-up with an aggregate deductible cover will automatically come into effect when the deductible amount gets exhausted. But unlike restoration, you need to purchase a super top-up plan separately. Also, the tenure of both plans should coincide as the threshold amount applies to each policy year of the super top-up plan.
Vishal Shekhavat: I have two self-occupied houses, one in Noida and the other in my home town Jaipur, and I have taken home loans for both. Can I now claim two house properties as self-occupied for tax purposes?
Divya Baweja, Partner at Deloitte India, replies:
As per the Finance Act, 2019, an amendment was made under Section 23 of the Income Tax Act, 1961, allowing an individual to own two house properties as self-occupied. And the aggregate deduction for principal repayment could be up to Rs 1,50,000 under Section 80C if the home loan has been taken from a specified organisation for purchase or construction of a residential house property. But unless you are using both properties for personal occupation, the tax benefit under the new provision will not be applicable. Consequently, notional rent (for one property) will kick in and you will have to pay tax on that. However, if you stay in a rented house and do not let out either of the properties you own, they will be considered as self-occupied. Also, any real income from any of these properties will come under 'income from house property' and will be taxable.
Sameer Singhal: Four years ago, I bought my car for Rs 8 lakh. I have been paying for auto insurance since then but have not made any claim. The resale value of the vehicle is around Rs 4.5 lakh. But I have kept the insured declared value (IDV) at Rs 5 lakh to be fully protected against theft. Will the insurer pay me the full IDV if the car gets stolen?
P. Ramesh Venugopal, Executive Vice President (Claims) at IFFCO-Tokio General Insurance, replies:
IDV of a vehicle is determined as per the manufacturer's listed selling price at the time of purchase after applying depreciation wherein the vehicle's age is taken into consideration. The value is determined based on the General Insurance Council regulation; the market value of the car does not prompt it. It is the 'sum insured' in case the car is stolen or damaged beyond repair in an accident. You can decide on the IDV at the time of policy purchase and it remains valid throughout the tenure. In case of theft, the entire IDV is payable to the insured after applying the deductibles under the policy. As for damage, the insurer may pay less, depending on the restoration cost.
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