Term insurance is one of the robust ways to secure one’s family against financial problems arising out of an unfortunate event. Since it is such a valuable financial tool, we must be careful while selecting a plan. Here are five common mistakes when buying a term plan.
1. Procrastinating getting a term insurance plan
The longer you wait to buy term insurance, the more costly it will prove to be. The earlier one chooses to buy a policy, the lower the premiums will have to be paid for a longer and a larger coverage.
2. Not comparing policies
Term insurance plans can vary significantly. Another common mistake when buying term plans is the lack of research taken on part of the policy applicant. It is vital to compare different policies to truly find the term plan that suits one’s needs while being relatively affordable. One can use a term insurance premium calculator available on the website of the various life insurance providers. This way one is aware of all the popular offerings on the market and gets to make an informed decision about the term plan best suited to their life insurance needs. While comparing policies it is key to read the fine print of every policy document so you know exactly the coverage you are receiving.
3. Not Opting for Additional Riders
Term plans come with an option to avail riders. Riders provide additional financial protection over and above the life cover of the base term plan with a nominal increase in its premium. For example a rider like the critical illness rider offers extra financial cover over and above the life cover of the base term plan in case the policy holder is diagnosed with a critical illness. The advantage of opting for such a rider is that the claim amount in case diagnosed with a critical illness comes in very handy as a replacement of the income of the policy holder while he/she is recovering from the illness. It also helps with various medical expenses associated with the treatment of a critical illness. Thus it’s a wise decision to opt for riders for a more comprehensive protection. The optional 34 critical illness rider with a term plan like ICICI Pru iProtect Smart provides the claim amount if diagnosed with any of the 34 critical illnesses covered by the plan without the need of a medical bill.
4. Not Providing Accurate Medical Details
One of the primary reasons an insurance application is rejected is because of the incorrect medical information provided. The information could be incorrect for a host of reasons — such as inaccurate data, outdated reports, or not filling in certain compulsory information fields on one’s application form. It is crucial that the policy applicant shares both relevant and correct information during their application process. This will prevent any unpleasant surprises from getting in the way of one’s application process and intimating for a claim. Nowadays, insurance providers also conduct tele-medicals wherever applicable for a hassle free and faster issuance of the policy.
5. Choosing a Cheaper Plan with Lower Coverage
Term insurance plans are the purest form of life insurance and are designed to provide a large life cover at affordable premiums. The purpose of opting for a term insurance is to safeguard one’s loved ones from any financial roadblock in case of an unfortunate event. Now, to serve this purpose the policyholder should opt for an adequate life cover so that his/her loved ones can maintain their lifestyle even in his/her absence. So, the primary concern should be to get an adequate life cover. On the other hand as mentioned earlier term plans come at really fordable premiums. For example, a term plan like ICICI Pru iProtect Smart provides a large life cover of Rs. 1 crore at a monthly premium of just Rs. 490.
Term insurance plans is an essential to protect one’s family or loved ones in case of an unfortunate event. A term plan like ICICI iProtect Smart provides you with an all-in-one protection. Along with the life cover for the financial security of your family it also comes with the option of an additional cover for you with the critical illness rider providing a much comprehensive cover. The plan also comes with the long standing reputation of a stable brand like ICICI Prudential Life thus giving you the confidence when it comes to securing the financial future of your family.
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