Dos and Donts for Life Insurance Buyers

Strategies would help you with queries like which policy will suit him the best, what is to be avoided while selecting a life insurance plan. What to do, what not to do before purchasing a life insurance plan.

7 Dec,2016 09:15 IST 1222
Dos and Donts for Life Insurance Buyers

Like most buying decisions, individuals also gets confused while buying a life insurance policy. Questions like which policy will suit him the best, what is to be avoided while selecting a life insurance plan etc. keep on revolving in their minds. Below mentioned are some strategies what to do and what not to do before purchasing a life insurance plan.

Do’s

1. Research

An individual should have an idea about various life insurance policies offered by different companies. Investors can save a good amount of premium by doing proper research on life insurance policies offered by different insurance companies. An individual can compare the life insurance policies offered by different insurance companies through an online portal like policy bazaar.com.

2. Check the market image of the insurance company

An individual should always check the reputation of the company in the market whose life insurance policy he is planning to buy. One should not buy the policy of the company who is involved in too many disputes. Such information of the insurance companies is available on consumer forums.

3. Read the policy details

An individual should carefully read the terms and conditions mentioned in the application form before buying an insurance policy because he may not get the expected benefits when he needs the coverage the most. Especially read the fine prints of the application form.

4. Payment options

An individual should rightly choose the premium payment options available like monthly, quarterly, or annually that suits him the best. In addition, an individual can opt for an auto payment option to avoid delays or non-payment.

5. Free look period

Suppose, an individual has bought a life insurance policy and has received the policy document but after buying the policy he is not satisfied with the terms and conditions of the policy. Then, the policyholder has an option to cancel/return the policy purchased. However, a policyholder can exercise this facility of returning the policy within 15 days of receiving the policy document. The premium is refunded after pro-rata adjustment.

Don’ts

1. Information disclosure

An individual should give accurate details while filling the application form. Giving wrong/false details will result in the rejection of the claim when most required by the individual. All premiums paid so far will be not refunded. In addition, do not sign blank application forms.

2. Do not sign blank forms and delay premium

An individual should avoid signing blank forms and delay in payments of premium. A late payment fee is charged by the insurance company on the premium amount if there is any delay in payment of premium.

Conclusion

Since life insurance policy is purchased from a long-term point of view, a person should consider his needs and should do research on different policies offered by different companies. In addition, an individual should choose a convenient payment option to avoid delays in payment of premium. So that one can make the best use of the policy purchased. An individual should avoid giving false information at the time of filling the form because otherwise he will not be allowed to reap the benefits of the policy. By paying attention, an individual can avoid mistakes and select the best policy that suits his requirements.

Disclaimer: The information contained in this post is for general information purposes only. IIFL Finance Limited (including its associates and affiliates) ("the Company") assumes no liability or responsibility for any errors or omissions in the contents of this post and under no circumstances shall the Company be liable for any damage, loss, injury or disappointment etc. suffered by any reader. All information in this post is provided "as is", with no guarantee of completeness, accuracy, timeliness or of the results etc. obtained from the use of this information, and without warranty of any kind, express or implied, including, but not limited to warranties of performance, merchantability and fitness for a particular purpose. Given the changing nature of laws, rules and regulations, there may be delays, omissions or inaccuracies in the information contained in this post. The information on this post is provided with the understanding that the Company is not herein engaged in rendering legal, accounting, tax, or other professional advice and services. As such, it should not be used as a substitute for consultation with professional accounting, tax, legal or other competent advisers. This post may contain views and opinions which are those of the authors and do not necessarily reflect the official policy or position of any other agency or organization. This post may also contain links to external websites that are not provided or maintained by or in any way affiliated with the Company and the Company does not guarantee the accuracy, relevance, timeliness, or completeness of any information on these external websites. Any/ all (Gold/ Personal/ Business) loan product specifications and information that maybe stated in this post are subject to change from time to time, readers are advised to reach out to the Company for current specifications of the said (Gold/ Personal/ Business) loan.

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