It is said that savings and future financial planning should start the moment you receive your first paycheck. However, given the plethora of financial instruments available in the market, it can get a tad bit overwhelming to zero down on a plan. This is especially true when it comes to buying a term plan.
In this article, we give quick tips for buying a term plan.
Check if the policy offers riders
Riders help in enhancing the features of your policy. They can help by offering financial support under several unexpected and unfortunate events. If you opt for the accidental rider then, you can claim this rider for the financial help that you require as you recover from the injury.
Some of the best term insurance policies in India offer the following riders:
- Accidental death and disability cover
- Terminal illness benefit
- Premium waiver benefit
Pay-Out options of the policy are crucial
Another important aspect to consider while buying a term plan are the pay-out options. The primary purpose of term insurance is to make the life of your dependents easier in your absence. Thus, the way the plan pays out the benefit is crucial. This can come in handy especially for those whose family members and depend on them financially.
Check if the policy has a high claim settlement ratio
The claim ratio is an important and deciding factor, you must pay attention to while buying a term plan. This ratio gives you an insight as to how reliable your insurance company is. The claim settlement ratio also tells you these two things:
- How smooth is the claim settlement process of the insurer?
- How fast the insurer settles a new claim?
These two factors can give you a clear understanding of how easily your family members will receive the payout. Furthermore, it also gives you an idea how responsive the insurance company will be in case your family requires any assistance in the future.
Some term insurance companies have a proper process to handhold the bereaved family members through the claim filing process. Check if the insurance company has a set process for claim approvals and payout. You can get an idea of this by looking at reviews on the internet or talking to people who have availed of the payout.
It is advisable to seek professional advice when buying the plan. The financial advisor can suggest you the best plan for your requirements. You can also use a term insurance premium calculator to gauge the affordability of the plan you are choosing