The safety and security of the future are paramount. Investments in the right assets ensure that you can enjoy the benefits when needed the most. Life insurance has been considered to be a great way to provide assured benefits in case of the death of the policyholder. There are different types of insurance plans provided by government banks, private banks and financial institutions.
Different Types of Insurance Plans that you can explore:
If you start your search for the best insurance plan, then you will come across several options that are enlisted below:
1. Term insurance plan
2. Endowment plan
3. Unit linked plan
4. Child insurance plan
5. Retirement plans
Based on your preference, you can choose the right insurance plan for yourself or your family members.
Finding the Best Insurance Plan
The next most important question that pops up is to choose the right insurance plan. Sometimes the provisions of the policies might get confusing, but if you are clear about what you are looking for, you can easily narrow down your options to the best one.
- Need Assessment – One of the first things you need to work upon is assessing your financial goals. Since there are a number of insurance plans, choosing the best one can be a challenging task. If your primary objective is to provide security to your family, then an insurance plan that offers higher coverage at a good interest rate would be a good choice.
- Plan for Minors – If your aim is to provide coverage for your kid, and you are planning to invest to ensure your kid’s education, then a child insurance plan will be the best. And if you are planning for your secured future after retirement, then a pension plan will be the right option.
- Check the EMIs – It’s true that you are investing for the future of your loved ones and yourself, and you would want a good amount, but remember, for every insurance plan, you have to pay a premium amount, and this insurance premium varies based on the type of insurance plan, tenure, and insured sum. Hence, you must check the insurance plan offered by the different insurers. If you are not well-versed with this, you can contact a financial advisor about the same. Also, while making the decision, you must check the family’s annual expenses and multiply it by the number of years for which the income replacement will be required. The total amount of outstanding debts and the amount you need to set aside for your kid’s future education also needs to be considered. Based on all these aspects, you must make the right assessment.
- Choose the Right Policy Term – A key point that must not miss the radar is the term of the policy. It should ideally be the number of years for which the family will be dependent on you. The ideal way to calculate is to subtract your present age from the age at which you expect your income to stop flowing in.
- Choose only a Credible Life Insurance Provider– It is important that you must choose the right insurance provider. The credibility of the insurance provider is a must. The right way to assess this is by checking the claim settlement ratio of the bank. If the CSR is over 95% for consequent years, you can consider that institute reliable. You can also visit the Insurance Regulatory and Development Authority (IRDAI) website to get more information about the insurance provider. It is advisable that you must do a complete research of the insurance provider and then make the final call. A credible and reliable insurance provider will guarantee a hassle-free claim settlement.
- Invest at an Early Age- It is always advisable to invest in the insurance policy at an early age. This way, you can add rider benefits to your policy and ensure better coverage for your family.
Always choose a Comprehensive Plan– When narrowing down your option to the best life insurance, you must choose a plan that gives comprehensive coverage like critical illness, accidental death benefit, terminal illness rider and others.