5 Tips to help you find the right life insurance cover

Dec 06, 2018 | 6 days ago | Read Time: 3 minutes | By iKnowledge Team

Here are 5 tips based upon which you can buy the right life insurance cover?

Choosing the right life insurance cover is a decision wherein one cannot afford to pick the wrong product. After all, it is directly related to your family’s wellbeing in your absence. There are instances in life where we have all looked back and wondered if we have made the right decision or if we could have made better decisions. While hindsight is 20/20, it is always better to be well-equipped with knowledge when it comes to purchasing financial products.

Financial institutions around the country are running awareness drives to educate people about life insurance and how to ensure your family’s financial well-being when they begin life on their own should the worst happen. The standard rule that is widely considered is that of 10x income. Your insurance cover should be ten times your annual income so your family can sustain for a considerable amount of period in your absence. However, it’s too vague and does not help in the proper evaluation of the actual cover required for your family to sustain. Thus, here are a few tips based upon which you will be able to find the right insurance cover.

Goals:

Clarity with regards to proposal and policy: Asterisks (*) are more serious than they appear in the insurance policy. Pay attention to these asterisks to have an in-depth understanding. Once you have invested in a particular policy of your choice, reading related documents becomes mandatory. All the pros and cons must be considered along with the general implications. Actual benefits on paper can be different from what you visually see in advertisement and awareness, thus before putting pen to paper, read all the documents carefully, especially the proposal form as it’s a binding document in the contract. Fill all the columns carefully and do not shy away from clarifying terms or policies which you do not understand.  

Also, you must check the reviews from other customers as it helps you get honest feedbacks.

Cost of premium: Once you sign the documents, the premium needs to be paid on a timely basis. Timely payment is crucial in keeping the policy active. The payment cycle can be selected depending upon your choice. For instance, Aegon Life offers a wide range of insurance plans, such as wherein the insured is given the option of flexible premium payment, i.e. monthly, quarterly, or yearly. While selecting the product and the premium, evaluate the financial stress that you will incur in paying the premiums. It is crucial to know that if you fail to pay the premium, it might put all your efforts in vain.

Get the right advice: Choose an advisor who possesses the right knowledge and is capable of answering all your questions. A good advisor will help you not only with the perfect policy but also with the points mentioned above. There are numerous cases of misselling in the market today. Thus, you must first exercise the ‘free look’ option to understand the policy and its premiums before you take a call. With a free look, you can claim for a full refund of premium which you paid to the insurance company until now.

II/Oct 2018/4536


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