A good term insurance plan is an investment plan that provides coverage to the insured person for a term and once the term ends, one will no longer reap the benefits from it unless it has been renewed. If the policy holder dies during the tenure of the policy, then the family gets a lump sum amount as compensation. To choose the best term insurance plan, one should think about the needs of the family members and the number of dependents. The cost of lifestyle and expenses could vary with different stages of one’s life so it is a good idea to think about the future needs of the family while choosing a plan.
The purpose of the insurance is to ensure that the family does not fall into hard times in the absence of the breadwinner and that they should be able to maintain their current lifestyle. It would also be a good idea to take into account the inflation factor. Hence, ideally one should opt for a cover at least ten times the amount of one’s income. On top of it, if there is any liability that one has to cover like home loans, credit card loans or personal loans, then the cover that you get from your insurance must include these liabilities.
The riders that the insurance policy comes with could also be a deciding factor, as it could give you access to a host of other benefits along with the existing policy. Most importantly, one should definitely check the claim settlement ratio of the insurance provider one wants to opt for. It should not be less than 90%, as claimed by most industry experts. One must also check if there are benefits of online renewal of the term insurance and payment of premiums to maintain the insurance account.
Read Also: Steps to Choose a Right Term Insurance Plan
Alisha Antil is your best financial helper for insurance. She has a vast experience in finance and insurance and provide to you the expert advise in insuring your property and health. She has in depth knowledge and has written more than 1200 blogs on topics related home and car insurance. She also provide you with knowledge about home improvement and cooking.