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How to Select the Right Insurance Company for Term Insurance?

Term insurance is one of the most secure and the best ways to provide financial security to your loved ones and achieve the financial goals of life. However, with an extensive range of term insurance plans available in the market, it often becomes difficult to choose the best term insurance plan in India as per your own requirement and suitability. 

Besides the various different factors that should be considered while purchasing a term insurance policy, choosing the right insurer is equally significant. Further, in this article, we will give some insight on how to choose the right insurance company and some tips to choose the best term insurance plan in India.

How to choose the Best Insurance Company

The insurance company plays a vital role while purchasing a term insurance policy. In order to choose the best insurance provider, it is very important to keep a proper knowledge of the claim settlement ratio of the companies. The factors that should be considered while choosing the best insurance company are:

  • Claim Settlement Ratio of the Company

    You should always consider purchasing a term insurance policy from the insurer who has a higher claim settlement ratio. This way you can be ensured that the claim filed by the beneficiary will be processed on time.

  • Early Claims

    The early claim arises in case of death of the insured, within the three years of policy initiation.The non-early claim is settled only by submitting the receipt of simple claim form along with the death certificate of the insured. Early claims need investigation prior settlement. Thus, the company requires more time in settling such claims. According to the instructions of IRDA the early claim should be settled in a time period of 1 month. 

  • Lapse Ratio

    Lapse ratio specifies the policies which are terminated due to the failure of payment of premium. In case the policy lapses before enough premiums are paid by the policyholder, the insurance company will not be in a position to cover the early expenses of the policy. Thus, the policy buyers should always consider choosing the insurance company with a lower lapse ratio.

  • Service Quality

    The service quality of an insurance company is one of the most important factors to consider. It showcases the attitude of the insurance provider towards the customers. It is very important that the insurance company should have a good customer support service so that all the queries of the insurance buyers can be taken care of. Moreover, by having a proper service quality, the insurance buyers can take the help of the experts and make an informed decision.

  • Customers Reviews

    On the basis of the customers’ reviews, you can evaluate the insurer. In order to choose the best term insurance plans in India, you can go through the website of the company to check the reviews of the customers. This way you can ensure the reliability of the insurance company and zero in on the best term insurance plan in India.

    • What is the number of grievances solved by the particular insurance company in a year? 
    • Check the online reviews of the company.
    • Check the credibility of the company by determining the post-sale service.

Tips to Choose the Best Term insurance Plans in India

In order to choose the best term insurance plan in India, it is very important to understand the financial requirement and what is the objective of purchasing a term insurance plan.

  • Access your long-term and short-term financial needs.
  • Based on the number of dependents you have, you should decide the term insurance coverage amount.
  • If you want to purchase a term insurance plan with an objective to secure the future of your family financially, then you should consider investing in a term insurance plan with a higher sum assured amount and lower premium rate.
  • In order to choose the best term insurance plans in India, it is very crucial to compare various plans online.
  • The insurance buyer should check the inclusion and exclusion of the policy before zeroing in on a particular plan.
  • If required, you should consider opting for a term insurance rider.
  • In case of any queries, you can seek the advice on the customer support team and experts.
  • Consider the factors that determine the premium rate of the policy while purchasing the plan.

Why you should consider having a Term insurance Policy?

Having a term insurance policy is beneficial in many different ways. Let’s take a look at some of the benefits of having a term insurance policy.

  • Provides financial protection to your family.
  • Works as an income replacement in the event of life assured demise during the tenure of the policy.
  • Take care of the liabilities of the family in the absence of the breadwinner of the family.
  • Secures the life after retirement.
  • Helps to achieve the short-term and long-term financial goals of life.
  • Provide funds for your child so that they can achieve the major milestones of life.

Wrapping it Up!

Purchasing a term insurance policy totally depends on one’s own situation and requirement. The policy which is beneficial for others might not be suitable for you. Thus, there is a list of factors that should be kept in mind while purchasing a term insurance policy. By keeping the above-mentioned factors in mind you can not only choose the best insurance company to invest in but can also choose the best term insurance policy according to your own requirement and suitability.

Written By: PolicyBazaar - Updated: 17 November 2020
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