Let us consider a situation where you wish to buy a new set of television. You would go about it by either visiting a store or checking out different models on an e-commerce website. The next obvious action is to compare the models you zero down based on features and its price tag. It sounds all too familiar, doesn’t it? We kind of follow these unwritten protocols for the purchase of a whole lot of things. Then why not compare term insurance before purchase?
When you compare term insurance, the first and most obvious benefit is that you save a substantial amount of money. However, buying the cheapest plan shouldn’t be the goal. One needs to find a right balance between the premium and benefits on offer. And when you compare term insurance, you have the upper hand in deciding the right balance between the two parameters.
What to Compare Before Buying An Insurance Plan
Once you have decided to compare term insurance, it is important to know the right set of parameters based on which you can take the final call. Here is a list of all the tangibles which can lower your worries during decision making.
We almost always assume that insurers are well funded or never really bother about this aspect. A company with a good solvency ratio shows strong financials of the brand. What does a solvency ratio mean for you? Well, it just shows whether or not your insurer will be able to handle your claims requests. An insurer with strong and clear financials is more likely to acknowledge and work on your claims.
- Claims settlement
The claims settlement ratio is another parameter which gives you an insight into how a company operates. The ratio shows the number of claims successfully settled in a year versus the total number of claims. An insurer with a higher CSR is preferable, as the probability of them settling your claims is high.
Flexibility is one of the USPs of a term insurance plan. The tenure of a term plan is one of the aspects where you must have your say. A term plan with a shorter duration is preferable during the latter part of your career. On the other hand, if you are in the early phases of your career, a longer tenure is what you should be looking at. When you compare term insurance, do not forget to look at the tenure range being offered by an insurer.
You might have got an excellent deal on a term plan but it lacks a feature or two that you really want. That does not mean the end of the road for you nor does it call for cancellation of the policy. You can take the help of add-ons to enhance the capabilities of the policy. During comparison do check the list of add-ons that each insurer offers and the ones that attract your interest.
The premium cost of a policy is a default parameter that takes preference during a comparison. While your aim should be to pay less for a term policy, do not directly jump to the lowest premium on offer. There might be some trade-offs which is not immediately visible to your eyes.
- Critical Illness
There was a time when critical illness was sold as an add-on to a term plan. But these days some insurers have amended critical illness into a term plan. If this cover is a must for you, look out for insurers who provide it as an out of the box feature.
- Turnaround Time
One more quick check that you need to do before signing the cheque is the turnaround time for the claims. A faster turnaround time ensures that your family is not entangled with the claim settlement process.
Best Websites that Compare Different Plans
If you wish to compare term insurance, one of the ways is to visit the website of insurers on your own and ask for quotes. You can then list out all the features and benefits and take a call based on the information at hand.
Alternatively, you could use the services of comparison websites like Coverfox.com. You just need to provide some bare minimum information about yourself and these websites do all the hard work for you. In the end, they present a list of all the policies that cater to your needs. These websites help you compare term insurance and make the buying experience a breeze.