A term policy is a pure life insurance policy featuring broader coverage. You can either buy term insurance plans online or offline. In the offline approach, you have to get in touch with the agents or insurers, which could be more time consuming and arduous. However, when you buy a term insurance policy online, you compare plans by different insurers and select the right one from the comfort of your home. Here are some important steps that you should consider when choosing a term plan online:
Determine Your Needs
The insurance amount you choose should be sufficient enough to meet the financial obligations of your family in your absence. To figure out the amount that will be enough, you have to consider the following –
- Your present income
- Number of members dependant on you
- Your present liabilities, such as loans, mortgages, etc.
- Funds need to maintain your family’s present lifestyle
- The invested amount you put each month towards meeting financial goals such as buying a house, education, marriage, etc.
- The inflation rate
Typically, it is advised that the sum assured should be 15 to 20 times your current annual income.
Generating a Quotation
The first step you need to do when you are looking for an insurance plan is to fill in your insurance to generate a quotation. You will have to fill a form with your name, age, gender, contact details, annual income, occupation (salaried, profession, businessperson, or self-employed), smoking habits, etc. Furthermore, you will be asked to provide details about your educational background and work.
The information you put in will enable the system to assess different risk factors to calculate and provide the premium amount. You will receive a free quote for the premium you would pay if you choose the term plan. Moreover, you can also select riders that provide additional benefits such as coverage of critical illness, accidental deaths, etc. The rider options you select will also determine the premium you will be paying.
Completing the Online Form and Selecting the Payment Method
If you are satisfied with the quotation, the next step is to fill the online form. Based on the terms of the policy, you have the option to decide how often you would like to pay the premium. You can choose to pay annually, half-yearly, quarterly, or monthly. Since you are choosing an online method, you will have to pay the premium online as well.
A lot of insurance providers allow you to make changes in the frequency of your premium payment in the future. This feature will be mentioned in terms of the plan. You should check whether the company will allow you to change the premium for free, or you will be charged for the same. When everything is checked, you can fill the insurance form. In this form, you will have to add in details of your current life cover, lifestyle, nominee, etc.
The last step is to submit all the relevant documents supporting the details you have provided. These typically include address proof, identify proof, health-related documents, etc. Moreover, you need to get a thorough medical check-up to buy a term plan online. For this, the insurance provider will get in touch with you and schedule an appointment.
Taking a term insurance plan online is straightforward if you take the right approach. Online modules make it easier for you to compare different options. In fact, there are dedicated websites and software that will compare various plans for you. This will allow you to make a better decision. Additionally, also ensure that you read the fine print of the policy thoroughly before making choosing the policy.