A Term insurance is a purely a form of a form of investment and that provides protection to the family of the policy holder. At nominal cost of premium on term plans you can get you the best financial security for your family. These plans fetch high coverage amount compared to endowment and money back policies for your family’s safe and secure financial future.
Here we will discuss about the important key check list a person should look for at before buying a the right kind of term insurance plan:
Choose the right insurance provider:
It is always important to buy insurance from the right insurance company. Buyers always go for insurance companies that provide insurance at a lower rate so the premium is affordable. However, what should be looked at is the company’s should shave a good claim settlement ratio, duration wise of settlement of the claims and the its solvency ratio. The data of these three important metrics is available in the annual report which is made by IRDA. So before getting a term insurance see the report of IRDA to check about the company.
Choose the amount of cover wisely:
It is important to choose the protection which will be provided to the beneficiaries wisely. The amount of cover given chosen should be sufficient for the family to survive in case of untimely death of the person policy holder. Ask the your financial expert or consult the advisor before choosing the cover. You should know the financial goals and needs of your family. The cover should be able to repay the existing debts, and even after the repayment it should be able to generate a monthly income for the family., even after the monthly The cover amount it should also be able to meet the long term goals of the policy holder like marriage of the children , education, marriage, etc.
The term Tenure of the plan :
The premium of the term insurance plans increase as you age down. It makes more sense when your young to buy term insurance plans when you are young with maximum a longer tenure and at minimum premium costs.
Compare the premiums of the multiple term insurance plans:
You should shortlist a few companies before buying a term insurance plan and the compare their quotes from multiple companies to select a provider plan which best suits your needs. They should also take the every growing inflation rate into consideration.
Choose option for premium payment:
The insurance companies offer flexibility in the premium payment options. You can pay the premiums monthly, quarterly or yearly as per your choice. Choose an option which is convenient for you and make sure you pay the premium on time.
Opt for a medical test :
A medical test is required before opting for a term insurance policy. However Iit is necessary to go for a medical test to make medical claims to avoid any claim rejection on medical grounds. Also it is better to disclose lifestyle habits like smoking or, drinking to avoid facing issues later.
As the term insurance plan is the purest insurance plan. It is recommended that it should be the first policy of any policy holder. Based on the six steps mentioned above you can choose the right kind of the term plan which best suits the needs of your family.