How to Buy the Right Term Plan
Today, the market is flooded with investment options that promise people high returns with minimal or no-risks attached. This makes it harder to find the best fit for you. As an investor, if you are looking for an investment option that provides life cover, while encompassing your liabilities and future goals, it would be wise to consider a term plan.
A term insurance, is a life insurance plan that offers financial coverage to the beneficiary of the insured person for a defined period of time. It is a pure life cover, available at an affordable price. But, before you decide to purchase it, here are a few things you should keep in mind:
Provide the Right Details: As a policyholder, it is important that you abide by the norm and provide the correct information. As we all know, the premiums for non-smokers and teetotalers are relatively lower. But, this shouldn’t tempt you to provide false information. Concealment of lifestyle habits and medical conditions may even lead to the rejection of your application.
Don’t Consider Price Alone: Term plan insurance is usually the cheapest form of life insurance you can purchase. However, the low premium here should not be construed as the deciding factor. While it is good to calculate term insurance and then compare premiums to save more, it is also very important to purchase it from a company with a good reputation. After all, your family’s future depends on it.
Insist on a Medical Test: Although most companies will ask you to go through a medical test before offering you cover, some don’t. In such cases, make sure you insist on taking the test. This is because if something were to happen to you in the near future, the insurance company can declare that the person had lied while buying the policy and thereby refuse to pay the beneficiaries.
Get the Tenure Right: It is believed that a person should take cover until the age of 60-65 years. This cover can help people leave behind a legacy for their heirs. Selecting the right tenure will also help replace the income of the policyholder after death, and reassure their family financially.
Select Your Mode of Payment: After you have made the purchase, keep track of your policy and don’t let it lapse. In order to make timely payments, you can also instruct your credit card company to pay the premium whenever it’s due.
Term plans are not complex in nature. Although, before you buy it, make sure to collect accurate information, so that it makes things easy when your family needs to file a claim.