If you have a family, then online Term Insurance is an integral part of your financial strategy. However, selecting the best policy with the sufficient coverage is essential to make sure that the purpose of a policy is fulfilled.
• Decide the Coverage Amount you Need
Even those who understand the important of term insurance struggle to choose the exact amount needed. In case customer miscalculates, he or she could end up leaving his or her family in a very tight spot. The amount is based on number of dependents, financial status of a family, whether children are still young or are employed, policyholder’s liabilities and assets and source of income. Do not forget to consider your standard of living and future financial needs.
• Consider the ‘COST’ Factor
Know all the charges applicable, including administration fees, premium charges, rider charges, mortality charges and fund management charge. Recently, IRDA declared some modifications about these charges to make policies investor friendly. Also, online comparison of similar insurance products is necessary to know whether one insurance company is being costlier unreasonably. On the other hand, do not select a product just because it is available at affordable rate.
• Track Insurer’s History
People purchase a policy to protect their families against uncertain events. But, what if insured’s family is not able to receive the amount policyholder was covered for because of some excuses? Hence, track company record and find out the claim settlement ratio of the insurance company in India. Don’t get attracted by fancy offerings or low premium policies. Perform all the essential ground work.
• Check the Riders
Look what riders will cost and offer. Majority of insurance companies in India give riders like an accidental death cover which would double the cost of term insurance plan India. Read the policy documents carefully because it helps policyholders in the future and also avoid conflict with the insurer at the time of claim. Check the insured amount, coverage terms, deductible charges, exclusions etc.
• Avoid Excessive Coverage
Purchasing too many term insurance products is not good. Generally, it happens when a person blindly purchase plans to avail tax benefits. Don’t blindly purchase what your insurance agent recommends since agent may be selling a plan that earns him or her good money.