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5 Bad Habits & Factors Why One Must Have Life Insurance

5 Bad Habits & Factors Why One Must Have Life Insurance

In today's day and age having a term life insurance has become more of a necessity than a choice. Due to the growing uncertainties of life, the importance of life insurance has increased substantially. However, if one has any habits that can adversely affect their health or safety, one must definitely consider buying one or more life insurance plans. Although, buying a life insurance plan is a simple and easy process there are various factors that decide the premium rate of the policy. Some of these factors are age, income, health history (self & family), profession, habits, etc. Having any bad habits not only increases the risk to one’s life but also eventually increases the premium amount of the policy. So, read on and check how these 5 habits and factors determine if you need to buy a life insurance policy:

1. Smoking & Drinking:

If the insured is addicted to smoking and drinking, then his/her life expectancy automatically decreases as s/he is more prone to lung and respiratory diseases as well as critical illnesses as a result of organ damage. Thus, having a life insurance policy is very significant for those individuals who are in the habit of smoking and drinking. While the premium amount of their life insurance policy will be higher for such individuals, it also provides financial protection to the family of the insured in case of any eventuality, which is a valuable investment.

2. Weight:

The weight of an individual is another important factor that not only determines the overall health of the person but also decides how important it is to have a policy. In case, you are on the heavier side or suffer from obesity, then you are more likely to be affected with numerous health issues. This also holds true in case you are underweight and deficient of the necessary nutrients required for a healthy body. So, with the increase in risk that accompanies over and underweight people, it is important to have a life insurance plan so that your family can have a financial buffer in case something happens to you. Moreover, you can also take a critical illness rider along with your life insurance policy to provide an extra coverage in case you are diagnosed with any type of critical illnesses.

3. Age:

The age of a person is one of the most important factors that decide whether one should have a life insurance policy or not. Buying a life insurance policy at a young age not only saves an individual from paying high premiums but also has many add-on benefits. The earlier one buys a life insurance policy, the higher the coverage that he/she can avail with a minimum premium amount. Moreover, the insured can also create a financial nest-egg for their family, so that they can be financially secured in case of an eventuality. Consequently, with the increase in age, the risk factor of the insurer also increases and so do the premiums for the life insurance policy. Even if one has to pay higher premiums for a life insurance policy, he/she should definitely have one, so that they can deal with any type of emergency situation.

4. Lifestyle:

Nowadays, people’s lifestyles are changing drastically and are becoming more stressful and hectic. As a result, their health is adversely affected. Working for prolonged hours, poor diet, consumption of junk food, lack of exercise, etc. increases the risk of diseases. These days, it is very important for an individual to evaluate various health-related factors and undergo medical check-ups regularly. Similarly, it is equally significant to have a life insurance policy in order to have wholesome financial protection and safeguard the future of one’s family.

5. Adventurous Sports:

Any person who enjoys participating in adventure sports like bungee jumping, trekking, car racing, skydiving, etc. is at a high risk of meeting with accidents. So, even though a life insurance policy costs an arm and a leg, an adventure sports enthusiast should definitely have a life insurance policy so that they can deal with any unpredictable circumstance.

Conclusion

So, with the help of the above-mentioned points it must be clear that if any of these habits or factors apply to you, you should consider buying a life insurance plan. In order to choose the most beneficial plan, you can also compare the various plans online and select a plan according to your suitability and affordability.
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Why Should Everyone Have At least Two Term Insurance Plans?

Why Should Everyone Have At least Two Term Insurance Plans?

A term insurance policy will cover your life with the lowest possible premium. There are group policies as well as individual policies. It is very important to figure out your insurance needs and you should subscribe to the best insurance plan. The insurance requirements should be reassessed and it is a worthwhile option to consider a second insurance plan as well. If you buy a second insurance plan, the information about the first insurance plan should be shared with the second insurer.

What is a term plan?

A term plan is a type of pure life insurance plan in which one’s lifetime risk is efficiently covered. When the policyholder dies, the payout is made to the beneficiary. If the policyholder is alive after the term, there is no monetary benefit. Thus, a term plan does not offer survival benefits. You should buy a term plan to cover the risk at the lowest possible premium.

Rejection of death claim:

A death claim can be rejected on various grounds. The following are some of the reasons:
  • Incorrect/insufficient information in the proposal form
  • Failure to disclose accurate health history
  • Lapse of insurance policy

Most of the policies are settled by the insurance companies. You can go refer to the claim settlement ratio to understand the efficiency of the insurance company in dealing with the death claims. The claim settlement ratio is an indicator of the performance of the insurance company. Even though it is not an absolute indicator of the performance of the insurance company, you can depend upon it to some extent. As there is a risk in settling the claims, you should explore alternate options. By choosing more than one term plan, you can overcome the issue to some extent.

Benefits of two-term insurance plan:

You can buy two or more term insurance plans to fulfill your insurance needs. It is possible to have more than one beneficiary for the insurance plan. If you have two insurance plans, there is no stipulation of nominating the same beneficiary for both the insurance plans.

Extra protection – Extra protection by subscribing to more than one term insurance plan. Death benefit – The beneficiary can avail death benefit from more than one policy. Avoidance of claim rejection – The claim rejection can be coped with when you go for multiple insurance plans. Even if one insurer rejects your claim, you have a good chance having another insurer settling your claim. Thus, your nominee/beneficiary is well protected. Claim settlement ratio – The claim settlement ratio can be different for different insurance policies. The chances of your claim increase if the insurer has a high claim settlement ratio. Reach the milestone – Multiple insurance plans will help you plan as per the milestones in life. You can subscribe to an insurance plan based on the needs of your dependents. Children’s education, children’s marriage and purchase of new house are some of the new milestones which should be fulfilled with insurance policies.

Death claim - If the policyholder dies before the end of the policy term, the beneficiary will receive a lump sum payout, which is known as a death claim. The payment to the beneficiary will be made as per the terms and conditions of the policy.

It is customary to disclose complete information about the first insurance policy to the second insurance company. If you buy a third insurance policy, the information about first and second insurance policies should be shared with the third insurance company. Misrepresentation of facts will lead to the rejection of claims.

Restrictions:

There are certain restrictions on holding more than one life insurance plan. The sum assured of all the insurance policies should not exceed the Human Life Value. The risk assessment is conducted by the insurance company. As soon as you submit a proposal to an insurance company, it will go through the underwriting process. The insurance company will assess various kinds of health-related risks, before determining your premium and sum assured. The insurability is based on the annual income of the applicant and the existing life cover.

Claiming multiple insurance policies:

While claiming multiple insurance policies, you should furnish complete information about all the term insurance plans to the insurance company. A standard procedure is followed by insurance companies as per the guidelines laid down by the IRDAI (Insurance Regulatory Development Authority of India).

All insurance companies work under the supervision of IRDAI. The IRDAI protects the interests of customers. If there are any issues in claiming the policies, a ticket can be raised with the respective insurance company. If you do not get a response from the insurance company, it can be escalated to IRDAI as well. The insurance regulator will help you resolve the issue amicably.

Safeguarding the interests of beneficiaries?

You should buy at least two term policies to get a payout sufficient enough to fulfill the needs of beneficiaries. The death benefit can be claimed on all the insurance policies of the beneficiary. The beneficiary must collect the death certificate from the concerned authorities and it should be submitted along with the death claim form. The insurance company will process the claim form and the claim will be settled within 10 days.

The insurance company will verify the credentials of the beneficiary and the payout will be made at the earliest. If the beneficiary fails to provide complete information, the insurance company can demand additional information. If the beneficiary fails to submit the necessary documents, he/she should provide the same as per the communication provided by the insurance company.

How to apply for multiple insurance plans?

If you have plans to buy more than one insurance plan, the tips offered by experts should be followed. You will save time and effort by systematically planning for multiple policies.

Approaching an agency – If you approach an insurance aggregator, it is possible to explore insurance plans from multiple companies. Medical examination – You need to undergo the medical examination only once and the information is sufficient to be shared with all the insurance companies. Thus, you will save time and money by undergoing the medical examination once. Insurability - The insurance company should figure out the insurable interest of the beneficiary. You should fulfill the necessary documentation to fulfill the same. If you include your close family members such as father, mother, son, or daughter as beneficiaries, your proposal will likely be easily processed. While adding a third party such as a friend or colleague, you should prove their insurable interest through documentation. Assessment of insurance needs – It is very important to assess your insurance needs on a regular basis. You should assess your insurance needs as per a change in income or familial responsibilities. Opting for additional/multiple insurance plans should not be a financial strain. Buying at a young age – You should buy the term insurance plan at a young age. When you buy the policy at a young age, the premium is low. The same premium amount will be paid throughout the policy term. Hence, there will not be financial difficulty in contributing to the insurance premium. Reviews – You are advised to go through the reviews shared by experts. The reviews on various insurance plans offered by different companies will help you settle for the best. You can also opt for additional riders in an insurance policy to increase the overall benefit from an insurance plan. The best insurance policy should efficiently cover major life changes.

When you buy more than one term insurance plan, you pay an additional insurance premium. You may find it difficult to manage multiple policies. However, you can opt for multiple policies when the benefits outweigh the difficulties in managing the plans. There is no restriction in purchasing multiple policies from various insurance companies. When you purchase insurance policies from different companies, you should share the information about past term insurance plans while applying for a policy with a new insurance company.

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Five essential tips to follow before buying Term Insurance

Five essential tips to follow before buying Term Insurance

Term insurance is a must-have for all who have dependent family members or liabilities to pay off. This is the most basic and cheapest form of pure protection life insurance to protect the lifestyle of dependent family members in the unfortunate event of the demise of the breadwinner of the family.

It's a worrying scenario that a large proportion of people in India are uninsured. Even, highly educated class employed in the organized sector do not have coverage, beyond group term cover of around one-time salary provided by their employers. Term insurance is a must-have for all who have dependent family members or liabilities to pay off. This is the most basic and cheapest form of pure protection life insurance to protect the lifestyle of dependent family members in the unfortunate event of the demise of the breadwinner of the family. Following points may help you to choose your cover wisely.

1. How much term assurance should you take

The rule of thumb is to take a cover of around 10 times annual salary plus any outstanding loans. This level of sum assured will help repay the outstanding loan and maintain the lifestyle of the family members.

2. Should I take plain Vanilla term or a term assurance with Income Option

It is important to match your policy proceeds with your liability cash flow. The loan is likely to be settled immediately on claim event and therefore a lump sum amount equal to loan amount is appropriate. Balance sum assured can be taken as regular income or lump sum. If your spouse is financially educated and can make investment decisions, the claims amount can be taken as the lump sum, else it can be taken as income over a period.

3. What rider should I take with term cover

Most insurance companies offer additional optional riders along with term product. It is better to enhance coverage by taking accidental death benefit, waiver of premium benefit and critical illness rider to make your policy more comprehensive. Critical illness coverage provides living benefits and protects against the risk of living with disabilities post covered dreaded diseases.

4. From where should I buy term

Almost all insurance companies would like to settle all genuine insurance claims. The claims which usually get rejected are fraudulent or result of non-disclosure of material facts about the health or income. Therefore, just looking at the claims settlement ratio may be misleading. It may be worth looking at the corporate governance records, violation of regulatory norms and solvency ratios.

5. Should I buy online or through agent or bank

It may not make a significant difference whether you buy online or through the distributor. If you are internet savvy and comfortable with transacting online, you may get some discount while buying online. However, while buying from the distributor, you will get the comfort of face to face discussion and opportunity to raise your concerns with the distributor. The choice between online and offline is more of personal choice and a matter of comfort with online transactions.

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Common mistakes to avoid bearing in mind buying a term Insurance

A term protection plot is a prominent animatronics protection item due to the unmatched advance it blesses. It guarantees your lingerie a record amount expert in the matter of your inauspicious destruction and that too at the whole decision premiums. Which backup venture instrument guarantees you this?

Try not to rub your heads. No discretionary extra venture does. That is the reason term designs have turned out to be prominent. The allocate support to guarantee the low premiums and moreover, the payouts structure have made term arrangements the bit and package of everybody's money related portfolio. Notwithstanding, once purchasing a term take a stab at, people are not careful. They submit some totally normal mix-ups as a result of nonappearance of learning or on account of their numbness. Some basic errors made embed the resulting to:

Picking a low Sum Assured level to the accord about premiums

The USP of term designs is that they get a high scope at each offer of low premiums. In this way, these plans are simply the dynamism protection designs which endure you manage the cost of a genuinely tall scope level. Be that as it may, in the sky of you influence a purchase of a term to the plot you frequently hold back almost the measure of the Sum Assured for sparing a couple of hundreds upon the top-notch outgo. This is a blunder. The Sum Assured ought to be picked in light of your way of life prerequisite. It ought to be bounty adequate to allow for all your budgetary commitments in accomplishment you are not re. In the event that you are not sure just generally choosing the exact scope sum there are online term protection number crunchers which in the back. They endure you figure your optimal Sum Assured level in view of your monetary profile. Thus, associated with purchasing a term attempt, pick the ideal level of scope to guarantee money related free.

Picking a corrupting term

Term designs contract to pay them alongside without any assistance if passing happens amid the concurred term of the course. On the off chance that you survive the chose attempt residency there is, for the most part, no development payout. Individuals normally tend to pick a belittle residency which gives them scope for a disparage develop pass. On the off chance that you are to appreciate the greatest scope thumped out your term need to go for the most elevated reasonable residency. A profoundly created residency would cover you till a more drawn outage which expands the likelihood of the undertaking support being paid.

Not filling or checking the proposition shape

All the time, mulling over you get a term design from an operator or handle, all you offer off is sign the shape without annoying in benefit the points of interest said in that. Regardless of whether you reach fascinate your proposition shape, you lie around release reliability points of interest asked in the frame. This is a mistake. The proposition frame shapes the premise of protection game plan in light of which your strategy is issued. In the event that you in addition to not climate the points of interest or distort any imperative certainty your sworn notice may get endangered. Your approach may end up noticeably invalid and inlet if any essential actuality isn't educated to the insurance agency. Thus, at whatever point purchasing a term attempt, influence sure to ingest in the proposition to frame yourself and say that everybody the insight specified in that is honest to goodness and exact.

Purchasing without contrasting

Do you know what number of term protection designs are there for the appearance? Beyond any reasonable amount to try and partner! Each course, however, connected with feathered creatures, has swayed highlights and advantage structure. Indeed, even the superior rates vary crosswise over various plans. Thus, in the event that you get staying together in a term protection mean without contrasting the remain in plans, you will undoubtedly commit errors. It is possible that you would moreover a plan considering lesser highlights or stop continuing paying a well ahead premium. Along these lines, dependably think about the sway term protection designs in the before you achieve one. On the off chance that your impulse to set up you can find indicate Acme Insurance. You can enter your subtle elements and situate out not forlorn the perfect Sum Assured but rather in addition to the exchange premium statements. You can look at the sway premium statements analytic of the plans includes and acquire the best plan for your requirements.

Purchasing a term conspire, despite the fact that exemplary upon your assignment, ought to be done without anyone else after mindful thought. You ought to abstain from committing these errors in the event that you tormented the best term protection encounter. Only a small information, some new exertion towards plot examinations and you can make a get of the best term protection conspire. The plan would not just come continuing considering the keep for you agreeable scope for enough residency, it would be sensible upon your pockets as well.

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