Pick the right term insurance plan for your family’s needs

When babies are born, we tend to baby-proof the entire house so that the tiny tots do not bump into somewhere and hurt themselves. As they grow old, we take different measures to keep them safe and secure. However, not many of us imagine the day when we are not there for our kids and they have to go through rough patches in life. But we can always help them out by buying term insurance to help them deal with their financial needs smoothly once we are gone.

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Purchasing a term insurance plan is traditionally advisable for the sole breadwinners of the families. However, even if both the parents work, then they can buy term insurance for the family jointly or individually.

Once you buy a term plan, from your home loan to your personal loan, everything can be paid off in the eventuality of your death. You can choose a term insurance plan, and pay the premium all through the tenure. If you pass away before the tenure is over, the beneficiary of the plan will get the coverage for the sum assured.

Nevertheless, before you finalize a term insurance policy, you must consider some points that can help you get a better deal. Here is a term insurance guide to help you out:

Calculate the term insurance coverage you need

The first thing to consider while buying a term insurance plan is to calculate the coverage that your family would need in a situation of an untimely death. While you are calculating this, you can consider the number of family members, the stage of education of your children, the kind of loans that you are paying off, and the inflation.

The tenure for the plan

It is one of the most important things that you must be very clear about. Many of us get confused while choosing the tenure. If you want your premium to be affordable, you can choose a tenure that is not too short or too long.

Choose the riders wisely

It is quite significant to choose the riders wisely. There are four types of riders, which include:

  • Added coverage for death due to accident: If the insured dies due to an accident during the policy tenure, an extra amount would be paid to the beneficiary along with the basic sum assured.
  • Coverage for critical illnesses: If the insured is diagnosed with a critical illness which is also mentioned as one of the critical illnesses in the term life insurance by the insurer, the insured will get a lump sum amount.
  • Premium waived-off on disability: If the insured becomes permanently disabled during the tenure of the policy, he/she would not have to pay the future premiums.
  • Premium waived-off on critical illnesses: If the insured is diagnosed with one of the critical illnesses out of the critical illnesses mentioned in the policy, the future premiums will be waived off.

Claim settlement ratio

While you are looking forward to purchasing family term life insurance, you must check the claim settlement ratio. It shows the level of efficiency on which the term insurance company settles the policies bought by the policyholders. It is highly recommended to go for an insurance company that has a 95% and above claim settlement ratio.

All these are filters and not the key points based on which you will buy a term plan. You can visit IIFL Insurance’s website and check out the various term insurance plans offered by several term insurance companies. Choosing a term insurance plan for your family will be much easier through IIFL Insurance.

Interesting Related Article: “Why term insurance is better than other kinds of life insurance