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Features
Ref. No. KLI/22-23/E-BB/492
When purchasing Term insurance, make sure you also look at the features apart from the premium. Click here to know all about the features of term insurance.
In today’s fast-paced world, people are beginning to realise the importance of term insurance. Where previously only people in their late 30s or 40s felt the need to purchase insurance, nowadays, even the younger generation see the advantages of buying term insurance as early as possible.
The increase in demand has led to a plethora of insurance products in the market, and you must choose the right policy to get the best advantage. The trend is that policy buyers are attracted more towards insurers offering lower premiums and overlooking other features.
While premiums are an essential factor when deciding, you should not solely rely on the premium when buying a policy. You also have to look at the policy features and benefits and how it is helpful for you.
When purchasing insurance, make sure you also look at the following features apart from the premium.
When you buy term insurance, generally, insurance companies give you the flexibility to choose how you’d like your family to get the death benefit during claim settlement. You can request a lump sum pay-out to the nominee, or if you feel they’d be better suited to handle periodic payment, you can choose deferred payment.
In deferred payment mode, the insurer pays the death benefit in small amounts periodically. Pay-out flexibility is a valuable feature, so make sure you have this option when you purchase term insurance.
Insurers allow you to choose your premium paying schedule. You can either pay premiums at monthly intervals, quarterly, semi-annually or annually.
Yet another option is to pay the entire premium amount as a one-time lump sum payment. Get these details clear when you buy insurance so that you can choose the right premium payment mode to suit your specific needs.
This is probably the most significant factor when you buy term insurance. Your life cover is the amount your family will get in case you pass away. It must be sufficient to take care of their daily expenses at their current lifestyle, any significant one-time expenses in the future, pay off existing loans and other expenses like vacations, retirement etc.
If this amount is insufficient, your family may face a lot of problems in the future. When you see a policy with a low premium, the chances are that the life cover may also be less. Choose a life cover amount that is at least 15-20 times your current annual income.
It is advisable to choose a policy tenure that is as long as possible. If you select a short policy tenure, the policy will end sooner, and at that age, it may be challenging to get a new policy at affordable premiums.
Ensure that your policy tenure covers your family at least until your retirement or even after that. The longer the policy term, the longer your family get protection.
Thus, when you buy term plans, don’t let premiums be the only deciding factor. Look for the above features so that your term policy does not turn out to be short of your expectations.
Amit Raje is an experienced marketer who has worked in various Fintechs and leading Financial companies in India. With focused experience in Digital, Amit has pioneered multiple digital commerce in India. Now, close to two decades later, he is the vice president and head of the D2C business department. He masters the skill of strategic management, also being certified in it from IIMA. He has challenged his challenges and contributed his efforts in this journey of digital transformation.
Prasad Pimple has a decade-long experience in the Life insurance sector and as EVP, Kotak Life heads Digital Business. He is responsible for developing user friendly product journeys, creating consumer awareness and helping consumers in identifying need for life insurance solutions. He has 20+ years of experience in creating and building business verticals across Insurance, Telecom and Banking sectors
Features
Ref. No. KLI/22-23/E-BB/2435
The information herein is meant only for general reading purposes and the views being expressed only constitute opinions and therefore cannot be considered as guidelines, recommendations or as a professional guide for the readers. The content has been prepared on the basis of publicly available information, internally developed data and other sources believed to be reliable. Recipients of this information are advised to rely on their own analysis, interpretations & investigations. Readers are also advised to seek independent professional advice in order to arrive at an informed investment decision. Further customer is the advised to go through the sales brochure before conducting any sale. Above illustrations are only for understanding, it is not directly or indirectly related to the performance of any product or plans of Kotak Life.
