Amid the pandemic, several businesses adopted the online model including the life insurance sector that built its digital outreach to remain relevant to their customers. Through the online medium, purchasing a policy becomes easy, quick, safe and stress-free. However, customers have to be equally discerning when selecting the right policy. How? Here are few tips to keep in mind before you sign the virtual dotted line:
Comprehensive research is a must
Whether this is your first time buying a life insurance policy online or not, research is important. This should be a mix of both online and offline, as it will bridge gaps in cost-effective options and help you select the best cover. Choosing a life insurance policy with an adequate sum assured is vital. A higher sum insured as per financial need is important as it increases the amount you have in case of emergency, which truly adds value in safeguarding the financial future of your loved ones. This is where an online calculator comes in handy, as a tool to help you calculate the coverage amount as per your lifestyle, future goals, and other financial requirements.
Comparison is key
The online world offers a wide variety of options for policy buyers, and, therefore, it is pertinent to compare offerings when purchasing a policy. As a potential policyholder, your research should entail a comparison between premiums, policy coverage, benefits, terms and conditions, and other specifications that help you make the right decision. Customers should base the results of the comparison based on their personal objectives and goals that they seek from the product be it pure life cover, investment or a mix of both.
Important to check to claim paid ratio of insurers
While a premium amount helps you assess the affordability of a life insurance policy, a claim settlement ratio or claims paid ratio is an important and reliable metric to determine if the insurance policy you are buying is an apt choice or not. This ratio helps assess the insurer’s commitment to delivering insurance claims settlement. A higher ratio helps understand the claims paid efficiency of the insurer and gives comfort to the family of greater chances, of the claim being settled by the company after the insured person’s unfortunate demise.
Ideally, you should choose a life insurance company that has good claims paid ratio. The Insurance Regulatory & Development Authority of India (IRDAI) publishes a claim paid ratio of all the insurance companies in India every year, the information of which is available on its website.
Be transparent and choose wisely
When buying a life insurance policy online or offline, it is important to disclose all information including medical history, lifestyle habits as this will go a long way to ensure speedy claims settlement. This will also ensure your family does not face any issues when filing claims if required.
Much like wearing a mask, maintaining social distancing, and getting vaccinated can protect us from Covid-19, similarly, a life insurance policy offers a shield that can protect you and your family’s financial interests. By following these steps, one can make a sound and prudent financial decision when it comes to purchasing a life insurance policy.
Manu Lavanya is the Director and Chief Operations Officer of Max Life. The views expressed in this article are those of the author and do not represent the stand of this publication.