When you buy a life insurance policy, you protect your dependents from financial losses that may arise in case of any untoward event. But apart from loss of life there are a number of events against which you buy protection cover. For instance, with growing awareness about medical insurance, we buy health insurance policies. Similarly, if you own a car you tend to buy comprehensive car insurance which goes beyond safeguarding you against just third party loss. As more and more people are buying non-life products, insurance companies are keen on introducing some innovative changes and added features to non-life policies in 2014.

Every company offers some unique features over and above those offered in the basic plans, at present. However, with changing dynamics of business, innovations and added features are going to gain importance in 2014.

What may change now?
When it comes to health insurance, very few companies are going beyond providing health cover currently. It is expected that, companies will start providing added services such letting policyholders avail discounts on purchases of medicines and on gym as well as spa memberships. For this purpose they might tie up with pharmacists, gyms and health clubs.

You may soon start getting extended covers on consumer durables. At present, typically, one may opt for extension of warranty upto 12 months. It is expected that insurance companies may allow you to extend these warranties by up to 24 months. Such a move is expected to protect policy holders from losses suffered on account of manufacturing defects which may arise at later stage. Such cases are on rise especially in case of smartphones.

Your comprehensive car insurance policy may get even better with added features and riders that may be introduced this year. Under current system, value of claim is settled as per the depreciated value of the car. So someone owning an older car would have to settle for negligible amount as the depreciated value would be far lesser than the actual cost of the car. But the concept of "return-to-invoice" is likely to gain acceptance in 2014. Opting for this rider (name may differ from company to company) would help you cover the gap between the insured value of the car and its invoice value (i.e. value of a new car). So in case of a total damage, entire amount originally paid by the policyholder (for car) would become the settlement amount. Insurers are also planning to establish tie-ups with petrol pumps and service stations to let policyholders avail their services in case of emergencies such as fuel supply and repairs. Moreover, use of telematics may also gain momentum in 2014. This requires fitting a device in the car of the policyholder for tracking his driving behaviour. Good driving behaviour may help him avail discounts in the premium in the long term.

PersonalFN is of the view that, product innovations may help policyholders avail extended benefits. But this will come at some cost. PersonalFN believes if you are willing to opt for innovative products, added features and riders, you must consider costs associated with them. If you have created a personalised financial plan for yourself, it would be easy for you to find out as to what impact the added cost will have on your cash-outflows. Depending on your requirements and the amount of additional premium that you may have to pay for innovations and added features, you might select a policy.

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