Is it Possible to Make Changes in a Term Plan’s Specification Post Purchase?

• 12th Nov 2019
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A term plan is a pure form of life insurance that offers you the ability to protect the future of your loved ones. The term insurance policy allows the policyholder to get an affordable life cover that is paid to the nominees in case of the insured’s untimely demise.

Even though the term policy does not offer a maturity value, it is still popular among people for the high sum assured it offers at low premiums. If you are wondering about buying term insurance, but are scared about being stuck with an unnecessary policy, you should be relieved to know that there are ways to change the specifications of the plan after purchase. Explained ahead are the ways to do the needful.

Change in the specifications of the policy

When buying a term insurance policy, you and the insurance company need to settle on certain specifications like the sum insured, the premium value, the tenure, and the frequency of the premium payments. These specifications are hard to be altered.However, some insurance companies increase the sum assured with time to cover for inflation.

Even though you do not have any control over it, it is still one way that the specifications of the policy change. If you want more flexibility, the ‘free look period’ will help you with the same.

What is Free-look period? – An initial solution

The free-look period for life insurance is a specific period allowed by the insurer for the policyholder to reconsider the policy and its specifications. It is generally 15 days since the date you receive the policy documents. During this period,you can study the policy more carefully and decide whether the plan is right for you. You can change the specifications like sum insured or the policy tenure to meet your requirements. It also allows free-look cancellation in case you do not want to continue with the plan. If you cancel the plan during the free-look period, the insurer returns you the premium after charging a minimum fee.

You must use this period to make sure that the term policy offers you everything you need so you do not end up with a wrong investment.

A different life insurance policy

Financial goals of a person can change at any point in life. You may require a larger sum assured or want to change the tenure of the policy to make sure that it meets with your new financial targets. Having a child will make you feel that way because you need a larger cover after your family grows in number. This is when you can opt for another life insurance policy. By doing this, you can increase the death benefit and enhance the financial security of your loved ones.

Other specifications

You can choose certain specifications about the policy during the tenure of the plan. You can remove or add nominees, update address, and change contact details easily by visiting the nearest branch or calling the customer care. The online term plan provider also allows you to do the same using the customer portal.

- A Consumer Education Initiative series by Kotak Life