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A First Time Buyer of Life Insurance? Here’s What You Need to Know
Posted on Friday, May 26th, 2017 | By IndusInd Bank
Shopping for life insurance is usually an overwhelming experience for many. With a multitude of policies available in the market, picking a policy best suited to you can be tough. However, once you have learned the basics, picking the right insurance policy becomes considerably less complicated. Here are a few essential tips on buying life insurance that you should follow, especially if it is your first time doing so.
Term Plan or Whole Life Plan
When it comes to the main life risks, there are two basic possibilities – living too long or dying too young. To cover these two risks, insurance companies provide either a term plan or a whole/permanent plan. A term plan covers the risk of dying too early, while a whole/permanent plan covers living too long.
Compare Covers and Features
When you are planning on buying a life insurance policy, it is best to compare a range of products. Every company offers a wide range of features and coverages; not only do these aspects differ amongst companies, but they also differ amongst policies from the same company. Based on your coverage needs, it is a prudent decision to examine every angle of a policy and not just the monthly premium.
Remember that Insurance Isn’t Just an Investment
The main purpose of a life insurance is to protect your beneficiaries financially in the event that you die. While permanent life insurance policies do gain cash value over time, they are not the best way to invest your money. Do not purchase life insurance as a sole mean of investment or increasing your wealth.
Buy Insurance from a Reputed Company
Your insurance policy, and subsequently the company, is what will take care of your family once you are no longer with them. Therefore, it is vital to research about the company you are purchasing life insurance from. Check their credibility on the market either via the internet or through friends and coworkers.
Take Advantage of the “Free Look” Period
Once your policy has been issued, most policy sellers offer something called a “Free Look” period. During this time, you will have a few days in which you can customize your policy to suits your needs and coverage requirements better. If you feel that the policy you have selected is not quite right for you, then the “Free Look” period is when you can change your mind and reject the policy, without being financially invested. Policy representatives can usually provide more details about the Free Look period for their products.
Add Policy Riders if You Think You Need Them
When you have selected a policy, you can add policy riders to improve your coverage. Essentially, riders, or endorsements, are ways to customize your policy in such a way that your coverage needs are met within your budget.
Consult a Financial Planner
While choosing life insurance may seem a simple task, insurance advisors are often driven by their commissions. A financial planner, on the other hand, will offer better advice, especially because he/she is more experienced and does not have a self-serving motive.
For a comprehensive plan that will secure your future, opt for a life insurance plan from IndusInd Bank. You can visit the IndusInd Bank website and apply for the plan online.
