9 smart strategies to follow while buying term insurance – Times of India

Term insurance is a crucial financial tool that provides a safety net for your loved ones in case of unforeseen events. Here are nine smart strategies to follow while buying term insurance:
1. Fill your own proposal form
Do not let anyone else, like an agent, fill out your term insurance proposal form. It’s essential to fill out the form yourself to provide accurate and complete information.Any incorrect details may lead to claim rejections in the future.
2. Keep your nominee informed
Don’t forget to inform your nominee about the term insurance policy. Keep them in the loop about the policy details, including where the documents are kept. This transparency ensures a smoother claims process for your loved ones.
3. Look beyond thumb rules
While thumb rules may provide a quick estimate of the coverage you need, it’s crucial to assess your unique circumstances. Consider factors like outstanding loans, future expenses, and the cost of living in your area to determine the appropriate coverage for your family.
4. Don’t forget about riders
Many people overlook the importance of insurance riders. Riders are additional benefits that can be added to your policy for specific coverage, such as critical illness or accidental death. Assess your needs and consider adding riders to enhance your policy’s coverage.
5. Understand your financial obligations
Before committing to a term insurance policy, understand the financial commitment involved. Be aware of the premium payment frequency, grace periods, and consequences of a policy lapse. This knowledge will help you manage your policy effectively.
6. Choose claim payout options wisely
When selecting the claim payout option, consider the financial needs of your family. Lump sum payouts may be suitable for some, while others may prefer staggered payments. Choose an option that aligns with your family’s financial goals and responsibilities.
7. Ensure adequate coverage
Avoid the mistake of underinsuring yourself. Assess your current and future financial obligations, including education expenses, outstanding debts, and daily living costs. Ensure your coverage is sufficient to provide financial security to your family in your absence.
8. Consider more than claim settlement ratios
While claim settlement ratios are important, they shouldn’t be the sole factor in choosing an insurance provider. Look into the company’s reputation, customer service, and the ease of the claims process. A reliable insurance provider is crucial for a hassle-free claims experience.
9. Don’t delay your purchase
Procrastination is a common mistake when it comes to buying term insurance. The earlier you purchase a policy, the lower the premium. Start your coverage early to secure financial protection for your family at a more affordable rate.
By being diligent in the selection process and understanding the nuances of your term insurance policy, you can ensure that your loved ones are well-protected in times of need. Take the time to make informed decisions and secure a term insurance policy that aligns with your family’s financial future.

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