Coronavirus has so far wiped out $5 trillion of the global wealth as markets are in panic mode. Domestic benchmark indices saw several instances of heightened volatility in February when Sensex plunged more than 1,000 points in a single trading session. While authorities have stepped up efforts to detect and prevent a mass outbreak of the epidemic in India, it is also pertinent to assess the impact of the deadly virus on the financial health of individual portfolios.

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Is this the time for panic or an opportunity to review financial plan?

According to Vijay Kuppa, Co- Founder, Orowealth — a direct mutual fund investment platform — panic will not lead to any recovery. "In fact it will increase the magnitude of the fall. So it is better to re-look the financial plan," he said.

Here are some key tips that one can use to safeguard the financial health of the portfolio:

Evaluate investment

According to financial experts, when it comes to individual investments, it is important to assess goals and time horizon. Someone, who is investing for retirement, has still a long way to go. There may be multiple market cycles for them. Investors, with short-term goals, may however need to pare down the amount of risk they are taking, experts suggest.

Also read: Do travel insurance policies cover the health risk like this?

Plan for emergency fund

One should try to have adequate emergency funds in any condition. An emergency fund can go a long way in meeting the short-term goals and stay financially cushioned during sudden situations.

Have an adequate health insurance in place

The Insurance Regulatory and Development Authority (IRDA) has asked insurers to address claims related to coronavirus. Many insurers have also launched coronavirus specific coverage insurance.

"Adequate health insurance will avoid the tendency to access assets held for some other financial goals," said Kuppa. There are health insurance policies available in the market with adequate cover to tackle epidemic or pandemic episodes of unknown diseases along with the advancement of treatment and post-hospitalisation care.

In words of Vikas Mathur, Head — Health Insurance, Universal Sompo General Insurance, "It is advisable that one should always bank on a reliable health insurance policy which can provide easy cashless access to secondary or tertiary care hospitals nearby," he said.

Do not liquidate

According to Kuppa, historically there have been many events that have caused the markets to panic. "However, we have seen markets recouping losses and hitting new lifetime highs. So, it is important to rebalance portfolio in order to reduce the overall volatility of the portfolio," he said.

Keep the exposure to equities in check

In case the exposure to equities is been very less as a part of overall portfolio, experts suggest to leverage this opportunity to build an equity portfolio through Systematic Investment Plans (SIPs).

"Diversify across asset classes in order to minimize overall risk. Look into asset classes like Sovereign Gold Bonds, P2P lending, structured debt etc," Kuppa explained.