Business & Policy | Industry And Cluster

How to Find the Best Term Insurance Plan in India A Guide

Published: January 18, 2023

C.R. Lawton once very rightly said, “Time is the one thing that can never be retrieved. One may lose and regain a friend; one may lose and regain money; opportunity once spurned may come again; but the hours that are lost in idleness can never be brought back to be used in gainful pursuits.”

Death is something you neither plan for nor put off because you weren’t ready for it. Therefore, it is crucial that you utilise this time wisely. Imagine that you are no longer alive, and your family is dealing with a terrible loss while also struggling to make ends meet since they relied on you. This brings us to our main concern: how to pick the best term insurance plan to protect the financial future of your family.

What is a Term Insurance Plan?

A term insurance policy is a type of life insurance that provides emergency financial support for you and your loved ones. It offers the insured life cover for a predetermined amount of time. You can successfully secure a high life cover at reasonable premiums if you invest in a term insurance plan early in life. The nominee will get the promised money in the event of the policyholder’s death by acquiring a term insurance plan.

Find the Best Term Insurance Plan in India

Finding the perfect match in a term insurance plan requires a lot of research since it takes into account various factors. Looking for a term insurance plan online is a more economically sound option than fussing around with agents of insurance companies. Let us have a look at the variables to consider in finding term insurance online.

  • Analyse your needs

Before you start looking for thebest term insurance plan, it is imperative to analyse and make a note of your needs and requirements. You need to focus your attention on the fact that the value of the cover you opt for is sufficient to meet your and your family’s economic needs in the future.

To know the appropriate value of the cover you need, you must keep a few things in your mind, such as what are your current expenses and financial obligations, your present income, any loans and liabilities, family members who are dependents, inflation, and most importantly the value of premiums you will have to pay so that it doesn’t hinder with your budget.

  • Choose an Insurer

You must be mindful of scammers who leverage people’s desperation. If you do not carefully study and understand the market, you could easily become a victim of fraud and scams. Therefore, while selecting an insurer, you must select one that has an established reputation in the industry and is dependable. Take these two things into consideration while choosing your insurer:

Claim Settlement Ratio: In a term insurance plan, a claim settlement ratio is the number of claims the insurance company settles against the number of claims raised by the insured. Therefore, in simple terms, the more claims the company settles, the higher your chances of having the claims raised settled. To make an informed decision regarding the claim settlement ratio, you can check the claim settlement ratio of the respective insurance provider from the annual report released by the IRDA every fiscal year.

Solvency Ratio: In a term insurance plan, the solvency ratio is the metric to assess the ability of a company to fulfil its long-term liabilities requirement and meet customers’ financial obligations.

  • Term Insurance Plan Riders

Although term insurance plans offer great coverage in their traditional form, nonetheless, you can enjoy a lot more benefits by choosing riders or add-ons on your term insurance plan to increase its utility. You can enhance the coverage by opting for these additional riders:

Waiver of Premium: The bestterm insurance plan coverage will still continue in the event of some critical illness or permanent impairment of the insured, requiring no further premium payments.

Accidental Death: In case the policyholder dies an accidental death, the family of the policyholder will receive an increased insured value as a death benefit.

Critical Illness: Under this rider, once the policyholder is diagnosed with a critical illness, they receive an additional amount other than the insured amount to help in covering the medical costs.

Income Benefit: With this add-on, the nominee of the term insurance plan will receive a monthly pay-out to help them continue with their life in case of the death of the policyholder.

Permanent and Partial Disability: Once the policyholder is diagnosed with either a permanent or partial disability, they are offered a percentage of the insured amount.

  • Calculating the premiums 

After completing the procedures above, you will need to know the monthly premium costs for the bestterm insurance plan coverage you wish to purchase. You can use a term plan calculator for this. You can fulfil your financial objectives by using a term plan calculator to determine the optimum term insurance plan coverage and premium costs.

Therefore, find the best term insurance plan in India by using the resources at your disposal and carefully reading the terms and conditions.

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