Is there insurance for job loss in India? Here's what expert says

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I am 43 years old and single. My parents have a pension. I work with a shipping company. I have Rs 40 lakh parked in Employees Provident Fund (EPF) and Rs 5 lakh in fixed deposits (FDs). I have Rs 2 lakh invested in two arbitrage funds. I also have Rs 38 lakh invested in Portfolio Management Schemes (PMS) and another Rs 8 lakh worth of cash with PMS. I also have SIPs worth Rs 60,000 a month in small-cap and mid-cap funds. I want to move out of PMS, but am willing to wait till the market turns around. I want to stop my SIPs. I also wish to take a sabbatical and buy a house in a few years. How am I doing? What changes do I need to make? 

Stopping a monthly commitment for any investment automatically reduces the possibility of wealth creation from that piece of money. If you are worried about the equity markets, then continue doing the SIP in a debt fund. If you stop your monthly investments, you will use the money up for something or the other and will be deprived of the best use for that money.  

Your PMS will take some time to turn around, so please be patient. You plan to buy a house a few years later. It means your need has not matured yet. Keep your options open—you can also rent. For the rest, you are doing fine. 

I have a job. It looks like I won't lose it even after the Coronavirus pandemic. But I am terrified by the thought of job loss. I hear there is insurance for job loss abroad. Is it available here? And what should I look for while buying it? 

Insurance companies calculate the possibility of risk, for example, the risk of a person dying versus that of losing his job. There is a far greater possibility of the latter happening. So, if you really had a policy for job loss, the premium would be insanely high, and hence it would not give you the required benefit. 

Yes, you can lose your job anytime. That's why financial experts advise you to have savings. Create a back-up. The party might end abruptly, so try to save at least 30 per cent of your income, to begin with. 

The answer to your question is: Yes, such covers are available but as an add-on facility with the primary policy. The benefits are way too tiny, so start saving aggressively if you have not done that so far.

Kartik Jhaveri
I lied in my medical insurance. Now I need to buy a life insurance policy. I realised I have to tell the truth about my medical history to them. Now, what can be done regarding my medical insurance? I bought it two years ago. I have not made a claim yet.

Tell the truth to the life insurance company. With regards to medical insurance, it's a policy that is renewable every year. Speak to your insurance agent to file this declaration with the existing company policy or switch your existing medical insurance to another company. In any case, you will have to make a declaration. If you don’t, you will face a problem when you make a claim for a medical issue that is directly connected with your previous medical history.

The property market is in a lull. Interest rates are low too. I have some money for down payment handy. Once the coronavirus lockdown is over and things begin to return to normal, would it be a good time to buy a property for investment? Is taking a loan in times like this a bad idea? I work in the private sector. 

Buying a property in this kind of environment could be a profitable decision. Borrowing money to buy this home would depend on your overall financial situation and your work situation. If you have any doubts regarding job security, then I would suggest you consider making other investments. Only when your situation is strong and stable should you consider taking on a long-term liability. 

I am 39. I planned to move to Canada, but now I am having second thoughts, thanks to the Coronavirus epidemic. I have sold my house and quit my job. I have enough funds handy to buy a house once things normalise. Will it be a better idea to purchase or rent? The job market won't be too good. I now live in Mumbai. My parents are in Madurai, but going back there is not an option. 

You seem to be in a sweet spot. You are young, have money and no time-based job commitment. Consider renting, as you might be able to pay the rent out of your investment returns. Renting is a more cost-effective option. It will also allow you to keep all your options open in life. 

I think we change the definition of what is "normal". Thanks to the Coronavirus, the new normal will not be the normal we were accustomed to. Our world will be quite a different one in future.

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