Since the last one a half years, we have seen more people buying term insurance policiesthan ever before. Well, to put it honestly, life is unpredictable, and it has become even more vulnerable due to COVID-19. People these days just do not want to take a chance when it is about their family’s future and security. So many young lives have passed away in just one year, that along with maintaining all the COVID-19 protocols, people are buying term insurance plan more than ever.
The good thing about term insurance policies is that many companies in India offer such policies. There are also various plans that you can choose from. You can choose the term plan that suits the needs of your family in a situation where you are not there anymore. However, before you make any decision, here is a term insurance guide that you can take a look at for a better idea.
- Claim settlement ratio:One of the most important term insurance tips while deciding on a term insurance policy is checking the claim settlement ratio. This indicates the number of policies and the efficiency at which the insurance company has settled the policies. If you find the company has a 98% claim settlement ratio, it means the company has settled 98 out of 100 claims.
- Calculate the term insurance coverage: The insurance coverage depends on the amount of money that the family of the policyholder would need to carry out the monthly expenses when the policyholder is no more. To calculate this, you have to consider the current liabilities you have, the monthly expenses of the family, and the future inflation.
- Tenure of your plan:Once you are sure about the coverage you need, you have to find out the tenure that you would need for the life insurance to cover. As it is about the tenure of the plan, it should not be too short or too long.
- Choose add-ons:While you buy term insurance, you can purchase add-ons or riders also.Some of the riders that are mostly available cover for critical illness, additional cover for death due to accident, waiver of premium on critical illness, and waiver of premium on disability. Of all these add-ons, the waiver of premium riders is available at a low premium. The most critical is the rider for critical illness cover. However, you need to find out which add-on you need and go for it accordingly.
- The premium amount:While purchasing a term insurance policy, you need to find out the premium amount you have to pay. While doing so, you can also check if you can pay the premium monthly, quarterly, or yearly. This will help you to understand the kind of money you are going to put into the policy.
- The payout mode:Some term plans come with flexibility in choosing the payout mode. The options range from paying out a lump sum of the amount or monthly payouts.The option for monthly payout can be helpful for the beneficiaries who are not very comfortable handling a huge amount of money.
Buying a term insurance plan is one of the best things you can do for your family. However, considering these things will help you to choose the right term insurance plan.Apart from all these, one thing that you should not forget no matter what is comparing the term insurance plans offered by different companies in India. This will help you to understand all the terms and conditions that come with term insurance plans and choose the one that is perfect for your family. As you consider comparing the plans, you can visit the website of IIFL Insurance.