Term insurance is a must specially for the breadwinner in the family. It is his duty to make his family secure even when he is not around. It is always better to buy term insurance online as you can compare from various sites and buying online will save your time and money.
Buying any term insurance plan may not serve the complete purpose as the plan should match your needs and life style.
Buying online term insurance can be confusing as there are various things you need to consider before buying it.
Here are 5 things to consider before buying term plan
1) Plan Coverage
Plan coverage depends on various factors such as your lifestyle, responsibility and liabilities such as a loan, debt. The insurance amount should be decided considering everything.
As policy is bought for the family members, it is necessary to consider all the members in the family and their financial responsibility.
2) Claims Settlement Ratio
Before finalizing any insurer, check for the effective settlement process, which are simple, quick and hassle-free. Also, the claim settlement ratio of the insurer. There is no point in considering an insurer who has a poor history of claim ratio.
3) Premium Amount
Lower premiums do not mean the insurer is good or bad. It depends on the insurer how well the claim settlement ratio is and how well he handles when the nominee approaches for the settlement. Premium is to be paid on yearly basis. Check for the affordability as it is long term process.
4) Policy Duration
If you are planning to buy a long term plan, do not neglect to consider inflation and other expenses which increase over time.
5) Right Nominee
In the event of unfortunate demise, the term plan offers a lump sum amount to the nominee. See to it that you choose the right nominee so that he can handle the finance as you have planned.
Things to Note
- Disclose all the information such as smoking, chewing tobacco etc.
- Check if the company is offering any accident rider, premium waiver or Critical illness cover.
- Even after buying the policy, if you don't find policy suitable, you can return the policy and claim refund during the free lock-in period.
- Inform about the same to your spouse and adult children about your insurance plans and documents.
- Note that, term plans are only for insurance purpose and should not be considered as an investment.