With every day to day needs going online, insurers have made it easy for the buyers to choose and buy their term insurance policies online. However, the perils of misunderstanding the plan inclusions and exclusions along with the risk of choosing the wrong plan is more when you buy a term insurance plan online. There are certain additional researches that one needs to do and be aware of various parameters before buying a plan online.
There is no alternative to a good research done before you select a term insurance plan online. One of the most important parameters that you need to look at before finalising a term insurance plan is the claim-settlement ratio of the insurer. Most of this information is available in the open source internet through various term insurance calculators and surveys conducted. Look for the top insurers and their claim-settlement ratio. Higher the ratio, the better is the plan for you and your dependents. It reduces any claim hassles during crisis or occurrence of any unfortunate event.
The early you buy a term insurance policy, the lesser will be the premium paid. Almost all the insurers mention the maximum policy tenure in their websites. It is very important for the buyer to do a comparative study of all the insurers and the maximum number of years that they offer the plan for, keeping in mind their personal requirements and liabilities before choosing a term insurance plan. The higher the number of years better is the plan option.
Solvency ratio indicates how capable an insurer is and its response rate to the claims as and when they arise. It also indicates the insurer’s financial strength. One should compare the solvency ratio of various insurers available online along with the claim-settlement ratio to pick up the best from the available. Again, higher the solvency ratio better is the insurer and the plan.
A term plan available online is not very different from what has been bought conventionally. The risk remains in the way the buyer interprets the policy outlines. There are various riders available for the term insurance plans that you buy online. Some of which are:
- Accidental Death Rider: An accidental death rider along with the term insurance plan provides the dependents with a benefit of receiving additional amount along with the assured sum in case the policyholder passes away in an accident.
- Waiver of Premium Rider: Non-payment of premium for a certain period of time could lead to the policy being lapsed. However with the waiver of premium rider, the insurance cover continues to be active even with non-payment of the premium. Instances where the policyholder is disabled permanently or partially or abrupt pause of the regular flow of income due to the policyholder suffering from a critical illness, waiver of premium rider provides a great deal of assistance to the policyholder and the dependents.
- Critical Illness Rider: Critical illness rider covers the policyholder from a plethora of life threatening diseases. Insurers clearly mention the illnesses they categorise as critical, most of which remains constant from insurer to insurer. A Lump sum benefit is paid out when the policyholder is diagnosed with a critical illness.
Cost of Premium:
Once you have done all the research on the claim settlement ratio of the insurer and various other factors, the most important parameter to take care of is the cost of the premium. A comparative study should be done to identify the insurer that provides the best term plan with various or no riders at the best price. Depending on your other financial liabilities, a term plan should be chosen with a premium amount that commensurate with your income, lifestyle and other liabilities.
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