Mistakes to Avoid During Buying Term Insurance Policy
We value everything we love and try to secure it from every bad omen. Luckily, with the evolution of technology, we have access to all type of insurance very easily without much paperwork and hustle. Along with the easy process of buying an insurance policy, doors for various another type of insurance apart from the basic plans have also started like car insurance, house insurance, travel insurance and etc. Among this list, there is one more name, term insurance. Term insurance is a mandatory insurance plan who has any dependent on him/her. At a very affordable price term insurance offers substantial life insurance to the policyholder. But, one way which leads to the right can also take you to a wrong journey. Following are the various mistakes that one should avoid during a term insurance policy –
- Failure in calculating the required insurance cover – We all try to foresee our need while we buy an insurance policy. But, mishaps can never be calculated. Many times we fail to consider various expenses and end up buying insufficient term insurance cover. IT is not an easy task to calculate future expenses for things like children’s education which is always hiking with time, so one needs to be well determined with the approximate amount so one should always look for different ways, for example, one can go for term insurance plan amount * ten times of your yearly .
- A mistake in research on different term insurance products – There are many term insurance products available in the insurance market. We are often in habit of doing everything in a hurry. In order to buy the best for our loved one, we try to settle on the best term insurance plan. But, it is not mandatory that the best plan offer the fire protection to your required areas insurance need differ from one person to another hence best also differ. There are many other factors like premium amount if you need an investment growth out of your term insurance plan like in ULIPs or the lower return endowment plans and etc. SO, you have to be very clear about your requirements out of a term insurance plan.
- The mistake of taking shorter terms policy – We often try to save our money as much as possible and in this process, we end up looking for a lesser premium amount option that results in short-term of the insurance policy. But, instead of saving your money you end up investing more amount as after one term insurance gets over, you have to buy another insurance plan and with age premium cost also increase so you have to pay more premium amount. Moreover, if you are not in the best health condition then the insurance company can deny your new term insurance plan. So, before buying a term insurance consider your current health condition, financial assistance that your family requires in your absence, your age and the hence required policy term should be kept determined.
- Not checking the claim settlement ratio – A claim is the most important thing in the hour of need that a policyholder looks upon. Also, claim settlement ratio is the easiest way to understand the performance of a company. In case of sudden demise of the policyholder, if his/her family does not get the benefit of various covers as promised by the insurance company in the policy, what is the benefit of such Term insurance policy? Hence, while buying a term insurance plan one needs to check on claim settlement ratio so that loved ones get all that you want them to have in your absence.
In India, there are many people who are already invested under the best medical insurance plans that promises them to provide the needful cover in case of any medical emergency. With such great help it will be easy for you to avail the required treatment on time so that you stay away from harmful effects of diseases. However, still we all know that future is not under our control, and we never now what is waiting for us in future and when we will fall ill or die and leaves our family stuck in a bad situation. So to fight against such issues and to provide needful cover to your family after your demise, it is essential to buy an effective term cover.