Buying a term insurance plan is a significant determination that should always be done mindfully. A term insurance plan not only provides a lump sum amount when required or at the end of the maturity period but further takes care of the aspirations that you hold for your loved ones.
It is a pretty uncomplicated insurance product where your life remains protected until you pay fixed term life insurance premiums. In case of your death, the insurance provider gives out a cumulative sum to your family to provide them with some financial stability. For them to avail of these benefits, you need to buy the right term life insurance policy.
5 Things to Consider Before Buying a Term Insurance Plan
While a term insurance plan is the most suitable investment option, it can provide a higher coverage benefit only when you purchase the right term insurance plan. Mentioned below are a few things that you must keep in mind while buying a term insurance plan.
1. Choose adequate cover
One of the most significant areas where most of us make mistakes while buying a term insurance plan is not choosing adequate coverage. However, selecting the right amount of coverage is the most important task and must always be done carefully.
You must always consider various factors like your age, earnings, profession, medical history, number of dependants, and average monthly expenses. Then, choose the term plan that can cover all these factors.
Choosing a term insurance plan with less coverage due to their low premium requirement will never prove beneficial in the long term. Hence, always ensure that you do not fail to choose adequate cover simply because it demands lesser premiums.
2. Decide on the term insurance plan period
Determining the term insurance policy period is the next significant selection to make. If you require higher insurance coverage at a low premium instalment, then it is always advisable to opt for a term insurance plan at an early age.
When the policy is acquired at an early age, you get the maximum policy period, proving beneficial in building a more secured financial bubble around you and your family.
Apart from this, many insurance providers further provide you with a facility to increase or decrease the life cover by paying a higher premium in the initial years. Thus, paying a term insurance plan premium does not feel like a burden when your expenses grow.
However, this is only possible when you choose the policy period wisely and opt for a term plan at an early age to safeguard your future.
3. Do not hide any information
To obtain the maximum benefits out of your term insurance plan and ensure that your family members do not get into any trouble while claiming the sum after your demise, you must never hide any important information from your policy provider.
If you are a regular smoker or drinker or may be suffering from an acute disease, disclosing all such information to the insurance provider will ensure that your term insurance claims are never rejected.
4. Add suitable riders, if needed
Choosing suitable riders is a supplementary benefit in a term insurance plan that provides you with additional coverage. These riders hold the potential to present added perks along with the benefits of the core life insurance plan. You can easily choose from the riders mentioned below that suits your requirement.\
4(A). Accidental Mortality Benefit Rider
This accidental mortality benefit rider provides an added sum guaranteed to the nominee or beneficiary in the event of the accidental demise of the policyholder.
4(B). Critical Illness Term Plan Riders
A critical illness term plan rider provides a lump sum amount to the beneficiaries if the policyholder is diagnosed with a particular illness and that too, without any conditions or sub-limits.
All you need to know about critical illness benefits under a life insurance plan.
4(C). Income Benefit Term Plan Rider
By choosing this rider benefit, the family members of the demised policyholder will receive an added income every year for a duration of 5 to 10 years. The most helpful part of this rider is that it is in enhancement to the primary sum assured.
5. Choose the right insurance provider
Choosing an appropriate insurance provider is another important point that you must consider before purchasing a term insurance plan. It is essential to examine determinants such as the insurance provider's experience, patron reviews, claim settlement ratio, and economic strength.
You must also pay a higher weightage to the client-centricity of the insurance providing organisation regarding sales, assistance, and premium payment choices.
A term insurance policy is regarded as one of the most prudent investment options in your financial portfolio. This not just renders financial assistance to your family but additionally serves as an assistant in funding their future. Hence, it is always important to choose the right term insurance plan to have no financial burden on the future.
Suppose you are looking for the most comprehensive term insurance plan that provides adequate coverage with flexible premium payouts. In that case, you must always choose iSelect Star Term Plan by Canara HSBC Oriental Bank of Commerce Life Insurance to safeguard the future of your loved ones. A term insurance plan is a modern investment option that guarantees your family and loved ones remain economically secured and protected in case of your early demise. If a person purchases a term life insurance plan, they will have to pay a specific sum from time to time.
This payment of a specific sum will always ensure that the beneficiaries or the nominees of the policyholder will be left with an assured sum even after the sudden departure of the policyholder. A term insurance plan is the most powerful and efficient form of insurance that presents extensive financial protection to an insured person and their loved ones.