Term Insurance Buying Guide : 5 Steps to Follow When Buying Term Insurance Plan Online
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Comparing term insurance is one of the best ways in which you can get a good term insurance policy. However, a comparison isn’t the only thing that you should do when you buy term insurance policy online. What are the other important steps to follow when you compare insurance plans and purchase a term cover online? Let us find out:
1. Know your needs
The first step in the right direction is to get a list of requirements made. Every family has different financial requirements. Your family’s needs won’t be identical to those of your friend’s family, so you cannot blindly opt for the term insurance policy he did. List down the number of dependents you have, their expenses such as school fees, medical bills, etc. Also factor in the rent, EMI, loan liability, lifestyle costs, etc. Once you calculate these figures properly, you will know what kind of term cover you need. Then, you can get a suitable policy with ease.
2. Fix a budget
The next step you need to follow is to make a budget for yourself. As mentioned above, the insurance needs of different people vary. As a result, the insurance providers also offer different types of term plans at different rates. You need to understand what your spending capacities are. Obviously, you would like to have the biggest and the most cm term life plan for yourself, but if that isn’t affordable, you should look for a cover within your budget.
3. Look for riders
Term insurance riders make your cover more suited for your exact requirements. This is why you need to explore the available riders and then buy the riders that are of most value to you, along with the term insurance policy. For this, you need to understand the scope of coverage of each rider. The common term insurance riders include the accidental death benefit rider and the critical illness rider, among others. Riders are add-on covers that are available at an added cost, so you need to keep your budget in mind when choosing a rider.
4. Choose the correct cover and tenure
Just as you need to choose the correct type of term plan, you also need to be very careful when choosing the coverage amount. If you need a sum of INR 5 crores to cover the financial needs of your family, make sure you get a term cover of that volume. Both, underinsurance and over insurance, are harmful. Similarly, you also need to get the perfect tenure. Your term cover should be active till your dependents need it.
5. Compare insurance plans and buy
And last but not the least, never buy term insurance policy online without comparing the available term insurance plans. When you compare insurance plans, you get to see all the options. Also, you get to make the purchase online which further proves to be profitable. The term insurance plans online and cheaper than the offline plans.
Now that you know more about the exact steps to follow when you buy term insurance policy online, go ahead and make a purchase right away.
Typically, most insurance providers offer policies with terms of 5 to 40 years. A person should always choose a policy term based on their anticipated retirement age. Of course, it can change. For instance, if you choose to retire at age 60, there may be someone else who chooses to retire at age 65.
Verify their market reputation, financial history, solvency ratio, and claim settlement rate. 2. Solvency Ratio - A company's ability to pay its long-term liabilities is measured by its solvency ratio. It is advisable to choose an insurer with a higher solvency ratio because it denotes financial strength.
Calculate how long your dependents will likely require financial support to cover expenses like mortgage payments and educational costs in order to choose the appropriate term for your life insurance policy. When choosing, keep in mind your age, health, and financial situation.26-Jun-2023
A term insurance policy is an option for anyone between the ages of 18 and 65. The best time to enter the insurance market and start making plans for your family's future is when you are in your 20s. Since most people start working and earning a basic salary in their 20s, they have relatively lower incomes and a lot of expenses.
Author Bio
Paybima Team
Paybima is an Indian insurance aggregator on a mission to make insurance simple for people. Paybima is the Digital arm of the already established and trusted Mahindra Insurance Brokers Ltd., a reputed name in the insurance broking industry with 17 years of experience. Paybima promises you the easy-to-access online platform to buy insurance policies, and also extend their unrelented assistance with all your policy related queries and services.
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