Mahesh Pai impresses his views on the importance of buying medical and health insurance

INVEST RIGHT / MAHESH PAI Importance and benefits of Health Insurance

The author impresses his views on the importance of buying medical and health insurance

In the last few months, the COVID-19 pandemic has drastically changed lives across the globe. Most countries have implemented various forms of lockdowns and restrictions to curb the spread of the coronavirus. With national and global health agencies continually stressing on the need to keep the immune system strong during the COVID-19 outbreak, the world has slowly started prioritizing health. It has made everyone to sit up straight and realise that medical expenses are unpredictable and can cause a financial imbalance in any family. These situations are very tough to handle. With a high positivity rate and a slow vaccination process, people have started to understand the having a good health insurance plan and the importance of availing the best medical services. Besides, with the rising cost of medical expenses, access to good medical facility and hospitalisation costs can be financially draining. Therefore getting a health insurance cover for yourself and your family can provide the added protection you need in tough times like these. Apart from the obvious benefit of having the financial confidence to take care of your loved ones, a health insurance plan is extremely useful when it comes to beating the expensive medical treatment.

It is rightly said that health is wealth. Changing lifestyle habits, your work life balance, your mental health, increase in pollution levels, and many other factors have a severe impact on an individual’s health. This may cause various health conditions and medical diseases. Medical costs associated with the treatment of such diseases are increasing rapidly. In order to safeguard your finances against high medical bills, it is necessary to invest in health insurance plans. Such plans cover all hospitalization expenses, as well as pre-hospitalization and posthospitalization charges.

Here are nine crucial reasons why you need to consider getting a health insurance plan today:

1. To safeguard your family

When looking for for an ideal health insurance plan, you have an option of choosing to secure your entire family under the same policy or buying separate policies for each member. You must ensure to get the best treatment may it be your ageing parents or young children who are likely to be exposed to illnesses these days. Due to any uncertainty that may arise you must not stress about medical costs but look after their treatment; but that is only possible when you have a suitable health cover. Research thoroughly, talk to experts and make sure you get a plan that provides all-round coverage.

2. To protect your savings

While an unforeseen illness can lead to mental stress, there is another side to dealing with health conditions that can leave you drained – the expenses. By buying a suitable health insurance policy, you can manage your medical expenditure without draining off your savings. The main purpose of medical insurance is to receive the best medical care without any strain on your finances.

3. To fight lifestyle diseases

Lifestyle diseases are on the rise, especially among people under the age of 45. Illnesses like diabetes, obesity, respiratory problems, heart disease, cancer all of which were prevalent among the older generation are now seen in the younger people too. Some contributing factors that lead to these diseases include the work from home lifestyle, stress, unhealthy eating and drinking habits, gadget addiction, no exercise and undisciplined lives. Investing in a health plan that covers all the expenses leaves you with one less thing to worry about.

4. To counter inadequate insurance cover

If you already have health insurance (provided by your employer) check exactly what it protects you against and how much coverage it offers. Such policies are not tailor-made according to the needs of every individual, Chances are it will provide basic coverage. If your current policy does not provide cover against possible threats - such as diseases or illnesses that run in the family - it could prove insufficient in times of need. And with medical treatments advancing considerably, having a higher sum assured can ensure your every medical need is taken care of financially. You don’t have to worry if you can’t afford a higher health coverage right away, you can start off slow and gradually increase.

5. To deal with medical inflation

As illnesses increase the medical technology improves and the cost for treatment rises as well. It is important to understand that medical expenses are not limited to only hospitals. The costs for doctor’s consultation, diagnosis tests, ambulance charges, operation theatre costs, medicines, room rent, etc. are also continually increasing too. All of these could put a considerable strain on your finances if you are not adequately prepared. By paying a relatively affordable health insurance premium each year, you can beat the burden of medical inflation while opting for quality treatment, without worrying about how much it will cost you.

6. Insure early to stay secured

Many people don’t understand that Opting for a health insurance early in life has numerous benefits. Since you are young and healthy you can avail plans at lower rates and the advantage will continue even as you grow older. you will be offered more extensive coverage options. Most policies have a waiting period which excludes coverage of preexisting illnesses. This period will end while you are still young and healthy, thus giving you the advantage that will prove useful if you fall ill later in life.

7. Coverage against critical illnesses

Insurance providers nowadays offer critical illness insurance, either as a individual plan or as a rider. Such an insurance policy provides coverage against life-threatening diseases such as kidney failure, bone marrow transplant, stroke, and loss of limbs, cancer etc. Upon diagnosis of any of the critical illness from the predetermined list of your policy, you are entitled to receive a lump sum amount. This amount can be used to meet your illness-related treatment costs, daily expenses, and any other financial obligations.

8. Cashless claim benefit

Many insurance providers offer cashless claim facility and you could buy policies which offer this service. with this facility you do not have to make any payments from your own pocket. The hospitalization expenses are settled between your insurer and the hospital.

MONEY MATTERS / V B PRABHU VERLEKAR Avoid Businesses to Stagnate

The writer discusses various challenges to businesses that could uproot their existence. He also offers solutions to ensure that businesses do not run astray and lose their mojo

Many family-run business enterprises, whether small or big, having made a promising start and achieved initial success, fail to grow and flourish and enter into a state of stagnation. This is despite them possessing tremendous potential and availability of ample opportunities. Many enterprises have failed by the time the second generation has taken over the reins of the business. There are a good number of examples in Goa itself where enterprises have hit roadblocks and are now riddled with disputes within the family and stakeholders as well as litigations, both internal and external, some of which are even reported in local newspapers.

A brief study reveals that there are some common causes for such underperformance, stagnation and failure that fits into the profile of any business. If one can spot them at the right time, steps could be taken to get the business back on track.

1. Failure to delegate and no succession planning

First generation entrepreneurs who have cultivated their business successfully as a result of their passion and hard work often don’t display confidence in the abilities of their children. They continue to micro-manage the business even after the business has grown to a stage where micro-managing hampers business growth. As a result, the focus shifts to minor and irrelevant issues and the outlook for business shrinks. The trust in the capacity of their own children or employees collapses. Gradually, the motivation to explore new horizons is lost.

For business growth, children and employees should be trained in every aspect of the business through systematic planning. They should be empowered with authority to take decisions and at the same time they should be laden with complete responsibility to back their decisions, even if they fail or the decisions appear to be wrong in hindsight. Succession planning is essential for business continuity.

The entrepreneurs should get the work done through delegation and supervision. The roles, duties and responsibilities of each family member in the business should be defined along with a commensurate remuneration. For this to be effectively done, the entrepreneur should hold short meetings on a regular basis with specific pre-determined written agenda. Decisions and issues discussed in previous meetings should be followed-up persistently till they are resolved and closed. Also, the entrepreneur should spend time in exploring new opportunities and look out for potential threats in this volatile, uncertain, unpredictable, complex and ambiguous world. To keep pace with times, one should encourage expansion of existing business as well as new ventures to meet aspirations of growing family clan.

To manage the inevitable, the entrepreneur should do succession planning with a carefully thought out “Will”, which is equitable and fair to the heirs. This would instill a sense of confidence, security and ownership in the second generation. Identifying and bestowing leadership roles to potential members would provide transitional continuity to the second generation after the baton has been passed on by the founder.

2. Tax evasion and unethical practices

Whenever a business grows, the profits swell and significant amount of payments are required to pay income tax, GST and other taxes/compliances. There is a temptation and tendency to evade these taxes by taking recourse to unfair practices of inflating expenses, suppressing cash sales, inflating project costs by diverting funds, buying unproductive assets like luxury cars to claim higher depreciation, charging personal expenses to business and such other unethical acts. Such acts may provide a short-term saving or thrill to the entrepreneur and boost his social standing.

But in reality, these practices result in a great damage to their business growth by affecting the financial health of the enterprise. The transactions make their balance sheets, which is primary document to avail credit facilities from financial institutions, appear weak. It presents an ugly picture of the business. Their entire balancing and control system of liquidity and inventory goes for a toss. The employees too, start losing respect and their motivation to work for business growth diminishes. On the darker side, this also encourages staff to be dishonest and cheat the business without any remorse seeing dishonesty of the owners in such unethical practices. Customer service gets affected as a consequence of the effect on the employees. Black money generated leads to luxurious and wasteful lifestyle for the family members, especially the second generation, and makes them unfit to face any challenges of business in the mistaken belief that earning money is easy.

3. Lack of focus on cash flows

A major cause of failure of business is not understanding the importance of positive cash flows. Cash is the life blood of business. If it dries, the business collapses like a pack of cards. The Covid-19 pandemic has made us realise the importance of having reserve cash flows. Cash flow is affected when short term funds are used for payment of longterm assets, which results in delay in payment of staff salaries, creditors, bank instalments and interest payments in time. Non-payment of government dues like income tax, GST and other levies can result in penalties and heavy interest and blocking of bank accounts. Non-payment of salaries on time demoralises the staff affecting their work. Heavy personal expenditure from business resources is another major drain on the cash flow.

Some owners are focused only on the turnover and market share. They look up to e-commerce giants like Flipkart and Amazon and think that if they achieve very high turnover, the rest will fall in place automatically and funds will appear magically. This is sadly often a misguided notion. Owners should look for cash profit and not just reporting book profits. For this, they should plan their activities properly and concentrate on collections. Cash is needed to operate a business successfully otherwise disaster is waiting to happen. Remember that in today’s times even valuations are done based on projected cash flows and not book profits.

4. Poor investment in knowledge and competent staff

Everything moves at a tremendous pace

1st Prize: Tejas Mutagekar

Rotary Club of Panaji Riviera Photography Contest

3rd Prize: Swara Naik

Rotary Club of Panaji Riviera recently floated a photography competition aimed at young talent. “We decided to have a photography contest on the theme ‘Disappearing professions in Goa’, with an intention of

in the world today. Unless your organization keeps pace with these changes and adapts to change, your business is bound to fail. Owners splurge business resources lavishly on holidays and luxury cars. However, there is hardly any provision made in the budget to invest in improving knowledge of the owners and their employees at all levels on a regular basis to improve and upgrade their skills and knowledge to keep up with the latest changes that are taking place in taxation, technology, human resource management, fund management and amongst competitors. This results in stagnation of the business and stagnation of the entrepreneurial spirit.

One should not aim at cost cutting when it comes to gaining knowledge or employing good employees. To achieve constant updation, owners and their staff should regularly participate in seminars, workshops and study relevant educational courses. They should also have mentors and professionals to guide them from time to time if they wish to remain at the top. Engage highly competent and quality staff and pay them well so that they do not leave you. Employees should feel proud of their organization for ethical practices and reputation. This is a major motivation factor for them and can accelerate the growth of the business

creating awareness amongst today’s youngsters about certain professions which they themselves may not have been aware of. The response for the contest was overwhelming and it was a tough task to choose the winners. We congratulate the winners and all other participants for the efforts taken in showcasing their photographic skills,” said Denzil Xavier, who along with Jeetesh Tolani coordinated the contest as part

2nd Prize: Alrick Pereira

of the Rotary Club of Panaji Riviera’s New Generation Committee.

Club President Ryan Cosme Costa and Secretary Tanvi Doshy Sawant applauded the winners