10 key points to consider before Buying Term Insurance -Life Insurance
Are you considering buying term insurance but feeling overwhelmed by all the options out there? Here's a simple guide to help you make the right choice:
1. Start with Plain Term Insurance: Keep it simple and straightforward. Look for a basic term insurance plan without any added complexities. (Term plan).
2. Research Insurance Companies: Not all insurance companies are the same. Check their claim settlement ratio and claim settlement by value ratio to ensure you're choosing a reliable one.
3. Buy Early: Don't wait too long to get insured. Start as soon as you begin earning. Premiums are lower when you're younger, and they remain fixed throughout the term of the plan.
4. Calculate Required Coverage: Your coverage should ideally be 20 to 25 times your current salary. Consider incremental cover options if needed.
5. Choose Full Premium Term: Avoid limited pay options. Commit to paying premiums for the entire term of the insurance to ensure continuous coverage.
6. Choose Term till Retirement only: Opt for a term plan that covers you until you reach 60-65 years of age. Avoid whole life insurance unless you have specific needs
7. Opt For Riders: Critical illness, accident cover, and terminal illness riders are essential additions to your policy for comprehensive protection.
8. Choose Payout Options: Depending on your family's financial literacy, choose a payout option wisely. Consider a combination of lump sum and monthly pension for better financial security.
9. Inform About Term Plan To Family: Make sure your family and close friends are aware of your term policy details. Share digital and hard copies of the insurance policy with them for easy access. So they can access and claim it in your absence.
10. Provide Accurate Information: When filling out the insurance form, be truthful and accurate. Misleading information could result in the rejection of your claim in the future.
Remember, buying term insurance is a crucial step towards securing your family's financial future. Keep it simple, but thorough, to make the most of your investment.
Good information
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