Generally, the best time to buy a term insurance policy is around your mid-twenties, when your responsibilities and the number of dependants on you are growing. In this case, your term policy ensures your loved ones are financially protected in your absence.
In order to get the most of your term policy, it is important to keep in mind details like the expiry date of your policy. This is because once your policy has expired, you stop receiving life coverage from it. And in case an unfortunate event occurs during this time, your loved ones will not receive the financial protection they would have if your term insurance policy was active.
In order to avoid such a situation, here’s what you can do when your term policy reaches the end of its tenure.
Extend your insurance
Most term insurance policies have a long tenure. This means that you may keep your policy active by continuing the premium payments. This is a good option if you wish to keep your policy active for a short duration of two to three years. However, as you age, the costs of your policy premiums will go on increasing, if you extend the tenure.
Convert your insurance
Today, a number of term insurance policies may be converted to whole life insurance policies. However, you will need to take steps towards converting your policy before it reaches its expiration date. One of the benefits of converting a policy from term to whole life is that you do not need to show insurability (no medical tests needed), if the coverage amount is the same. You should opt for conversion only when it is necessary.
Renew your insurance
This is the most feasible of the three options. Unlike earlier, today you are able to renew insurance online in a quick and hassle-free way. While you may still choose to renew your term policy offline, here’s why renewing your policy online will help you:
When you renew insurance online, you have the flexibility and convenience of doing so at your own time and pace. There is no agent involved here. This means you save a lot of time. In addition to this, you have the option of making renewal payments via:
- Internet banking
- Credit cards
- Debit cards
- National Electronic Fund Transfer (NEFT)
- Electronic Clearing Services (ECS)
Less chance of fraud
When you renew insurance online, you generally do so via your insurance provider’s website. This means you have access to all the accurate information. This ensures negligible chances of a fraud.
Easier on the pocket
Renewing your insurance policy online helps you save money. This is because not only are online insurance policies cheaper, but also because you save on the commission, you will otherwise pay for an agent’s services.
It is essential to keep a tab on your term insurance policy’s maturity so that you are well-prepared in advance to either extend, convert, or renew your policy on time, depending on what you’re looking for.