Planning to buy life insurance online? Here are the top points you need to consider
According to investment advisors, life insurance is the need of the hour, considering the uncertain environment we currently live in. An insurance policy provides the much-required safety for you and your family during tragic times by securing your financial commitments. It is the reason why financial experts recommend individuals to buy life insurance as soon as they start earning to avail life protection at a low cost.
What are the different types of Life Insurance Policies?
Here are the 4 different types of Life insurance policies as mentioned below:-
Types of Life Insurance policies:
With numerous insurance companies offering various types of life insurance policies, it may be challenging to pick the one you need. To help you get an overview of the policies available, here are the top-selling insurance policies sold in the market:
- Term Insurance: The classic life protection policy is term life insurance that offers financial security for your family in case of unfortunate events such as death, accident, illness, etc. While you can get a high cover amount at an affordable premium, no maturity benefits are paid on surviving the policy term.
- Money-back policy: This is an insurance policy with the same features as that of a term plan, but you are eligible to get back the premiums paid at the time of maturity.
- Whole Life Insurance policy: Unlike insurance policies that are only offered for a limited period, these policies provide coverage up to 100 years of age. It can be helpful for individuals with many dependents to take care of.
- ULIPs: ULIP also offers the dual benefit of insurance and investment in a single plan. While a specific portion of the premium is invested in the market, the other part goes to provide life coverage to the policyholder. At the end of the policy term, the generated returns are paid back to the beneficiaries.
Going through these life insurance plans and choosing one among them is not possible in the real world, but it is undoubtedly an easy task via the internet.
5 Things to remember while buying a life insurance policy online
Buying a life insurance policy online helps save time, energy, and money, right from sitting at the convenience of your home. But there are certain vital things that you need to keep in mind to make your online purchase is a worthy investment.
- Choose the right cover amount
- Provide accurate information
- Compare Policies
- Look for Claim settlement ratio
- Customer Support
1. Choose the right cover amount
Decide on the right sum assured before availing of an insurance policy as it is going to be received by your family in your absence to handle the household expenses. Not only this, it will safeguard your existing assets, pay for outstanding liabilities such as home loans, car loans, etc., apart from creating a corpus for the future of your partner and kids. Without a proper financial backup or adequate insurance coverage, there is a high chance for family members to scramble for funds after your demise, which you would not want to happen. Nowadays, term insurance plans offer 1 crore, and 2 crore coverage amounts at an affordable premium. Therefore, take enough time to assess the liabilities and decide on the coverage amount so your dependents would not have to suffer financially, even in your absence.
2. Provide accurate information
Even though you choose to buy an insurance policy online, it is necessary to provide your insurer with precise details about yourself. For example, the insurance company will ask to disclose your family, the number of dependents, your health history, smoking habits, etc. These details will help the insurer to understand your risk profile and fix premiums accordingly. You may also be asked to undergo a medical test and submit the reports to ensure you are free from any underlying health condition.
Entering wrong information in the application form or choosing not to disclose information voluntarily will put your family at risk when filing claims, as the chances of your request getting rejected are also high. Therefore, to save a few hundred on the premium, do not enter false information in the form when filling the online application form.
3. Compare Policies
The most significant advantage of buying insurance policies online is comparing similar plans side-by-side and understanding the feature set of each policy and their costs. Unfortunately, there are 24 life insurance companies in India, and visiting their offices to know about their policies is not possible. Moreover, the chance of being misled by insurance agents is also very high. But you may visit their websites and check out the policies and know their benefits, right from the comfort of your house.
Some websites collect policy details from all insurance companies and display suitable policies based on the input you provide. In addition, their online comparison feature offers a clear view of each policy with its positives and negatives, helping you to shortlist the one that offers maximum benefits.
4. Look for Claim settlement ratio
The claim settlement ratio of an insurance company is the total claims settled divided by the number of claims received by the company in a year. It is an important indicator to know how reliable is an insurance company in determining the claims. A high claim settlement ratio (CSR) means the company is settling a majority of the claims on time and can be trusted. On the other hand, an insurance company with a low CSR ratio denotes the claims are not being settled on time. Even if you buy an insurance policy online, it is advised to pay attention to their CSR percent and choose a policy accordingly.
5. Customer Support
When you choose to buy life insurance online, it is essential to check the responsiveness of their customer service department. Although most insurance companies have a physical office where you may visit to lodge complaints or file claims, it is also equally better to check up with their email and call center responses. In addition, it would be your first point of contact in case of emergencies. So, look to interact with their service representatives regarding queries related to policy selection, features, claims, etc., and see if you can get convincing answers.
Keeping all the above points in mind will ensure your journey of buying a term insurance policy online is smooth and without any trouble of misinformation or mis-selling.
