Dummy’s Guide to Getting the Best Term Insurance Plans

Life insurance is no longer restricted to the conventional, endowment insurance covers that most of us know about. With time, there has been a steady and quick rise in the number of companies coming up with diverse insurance plans with different features, riders, and benefits. Now, you can opt for plain life coverage, money back plans, annuity plans for regular pension covers, and single premium term insurance plans among a host of alternatives.

In case you are getting confused, this dummy’s guide to getting the best term insurance plans will put you back on track.

Checking the Reputation of Companies

Before delving into the world of term plans and all that it partakes, it would pay to understand how to check the reputation of insurance companies shortlisted by you. Know more about the top term insurance companies based in India. Look up their credibility in terms of transactions, market share, claim settlement ratio, etc.

1. Claim settlement record

You may want to find out about the time lags undertaken in context to settlement of claims by different companies. Also, read in depth about the policies and pre-conditions as laid down by these providers in terms of claims processing. It is best to avoid companies that are known to go through voluminous paper work with the view of prolonging claim settlements.

Also, stay away from companies with higher claims repudiation ratio as they have dubious intentions or end up revealing their underwriting competence.

2. Bonus payment record

Companies with better bonus payment record and higher cost efficiency are what you should seek to get good returns on your insurance. Do not get lured by promises of the highest returns in the marketplace.

Always ascertain a company’s past performance with regards to different term insurance plans and products before moving ahead.

3. Reviews of customers

Online customer reviews often talk about the support and services of top insurance companies in the reckoning. Customer reviews and first-hand inputs from current and past policyholders will help you assess the reputation, payment capabilities and fund-raising capacity of various providers.

Important Factors That You Must Consider While Buying Term Insurance Plans

If you are new to the world of insurance, then the following pointers will come in handy while buying the best term plan.

1. Buy as early as possible

As there is no specific age bracket for term insurance purchase, it is a good idea to buy one as soon as possible. If you allow time to pass, the premium amount will increase as per your age and the incidence of any disease or illness.

2. Buy term plan only till retirement age

Remember, you will need a term plan only till you retire. Thereafter, your family members would no longer be dependent on you as far as finances are concerned. It makes sense to get yourself a large enough cover when you are young and working, as various financial responsibilities have to be taken care of in times of your untimely death.

3. Don’t fall for ‘per day premium’ ads and gimmicks

You may have seen several insurance ads that talk about the cost incurred to insure holders on a per day basis. For instance, “purchase 1 crore cover for only INR 25 per day.” Such numbers are not applicable to all plans, policy tenures, and premium amounts. Your insurance requirements may be absolutely different; so, do not fall prey to the charm of cheaper premiums.

4. All insurance riders are not for you

Though riders add to the benefit package of term plans. Not all of them are specific to your case. Do not increase your premium by adding riders merely because they are available on the rack and assure a sense of higher security. However, if they really cater to your requirement, compare and choose the best suited plan wisely.

Buy the Best Term Insurance Plans after Comparison

It is recommended that you do not fall for the first term insurance policy that comes your way. Additionally, the cheapest plan may not be the best one for your coverage needs. Do compare the insurance products from various providers on sites like Coverfox.com before renewing or buying term plans – that’s the right way forward!