Life insurance is an important investment instrument that everyone should add to their portfolio. It helps them secure their family’s financial future even if they are no longer there to provide for them. It is very easy to find a suitable policy these days. You can use a life insurance calculator to calculate the sum assured required to cover your family’s needs and the premium you can pay affordably for the policy duration.
Don’t make the mistake of investing in the cheapest life insurance. While they save you money in the short run, they may not deliver on its commitment of protecting your family when the time comes. Money is certainly an important factor to consider when buying the right policy, but it is also important to make sure that the insurance plan covers all the bases and provides ultimate security blanket to your loved ones.
One way to do that is by using a life insurance calculator that lets you see objectively how much insurance you would need to pay for the sum assured you want. However, your premium is influenced by multiple other factors and there are many other things you need to keep in mind when purchasing a life insurance plan for your family.
So what is insurance and how to get one? Let us discuss in detail.
1- Policy Tenure
People who are looking for an affordable life insurance product can opt for term insurance. These plans are simple and provide you a sizeable cover for a small premium. Term insurance can help your family secure their financial future, in case something happens to you. It is, therefore, necessary to choose your term plan carefully.
An ideal term insurance will cover your total income that you make through your working years. Most policies will offer policy tenure for the minimum of 10 years and maximum of 50 years.
Make sure that your purchase the one that covers all your needs. That is where an insurance calculator can be of help. You can choose the longest duration applicable to you to arrive at a premium that you can pay throughout the policy term.
2- Choose the Right Plan
Term plans are pure insurance policies that come without maturity benefits. However, there are multiple other basic life cover plans to choose from which can provide you a monthly income along with the option to secure to your family’s finances in case of your untimely demise.
Be sure to assess compare the policies and use a life insurance calculator to choose a policy that suits your budget as well as requirements.
You can increase the coverage of your basic term plan with the help of riders. These add-ons can make your basic life cover more comprehensive by protecting you against life’s uncertainties, such as loss of employment, accidental death, critical illnesses, etc.
However, these riders require additional premium that can bump up your financial commitment. When you use a life insurance calculator, you will be able to see how much your premium will increase and how many riders you can add to your policy to keep it affordable. Riders should be aligned to your lifestyle and must be chosen as per your future needs.
4- Plan Cost
There are many reliable insurance providers, such as Max Life Insurance, that offer you wide range of insurance products suitable to all kinds of investors. In your selection of a life insurance plan, you need to ensure that the premium is affordable and something you can commit to for a long time. Using a life insurance calculator will help you make an objective decision.
5- Ease Of Purchase
You should be able to compare the policies and purchase your life insurance product with ease. Additionally, your insurance provider must also make it easier for you to access your plan details on a device of your preference.
6- Assess The Insurance Provider
What good is a life insurance that does not meet its end of the bargain when the time comes? If you have paid your premiums consistently, then your insurance provider should also honour their commitment by delivering the benefits to the beneficiaries when they raise a claim.
That is why you need to check their claim settlement ratio, a ratio that determines the number of claims settled by the insurer as per the number of claims raised. A reliable insurer is the one that has claim settlement ratio more than 90%.
Choosing The Right Insurance Company
The insurance provider you choose should be credible and capable of securing your family’s finances as you intended them to be. The best way to determine the credibility of an insurance provider is to consider factors, such as their corporate governance record, claim settlement ratio, number of years in operation, compliance to IRDAI guidelines, etc.
Every insurance provider worth their salt will be able to provide you this information and more. They also have robust online tools like a life insurance calculator to make your job of selecting the right insurance plan easy. You must carry out a thorough comparison with due diligence and use all these tools to your advantage to make an informed investment decision.