5 Points to Ponder While Buying Life Insurance Plans
While we are young most of us never think of death and therefore are never bothered to plan for the inevitable event. With progressing age and increasing responsibilities, we realize the need for a backup plan and this where life insurance plans step into the picture. As the sole breadwinner of the family, one of the most important accountability is to provide a blanket of financial protection.
This crucial blanket of financial protection is usually obtained in the form of a life insurance plan. With the right life insurance policy in place, you don’t have to worry about the future of your children and their needs when you won’t be around to provide for them. Regardless, of your age or marital status, a life insurance plan is an absolute must.
If you are planning to secure the financial future of your family and loved ones it is extremely important to purchase a life insurance plan. Very often, a lot of people are confused about the various factors to be kept into consideration while buying a term insurance plan in the UAE. In this guide, we’ll shed light on some of the most crucial factors to be kept into consideration while buying life insurance in the UAE.
Before we go ahead and look into the various vital points, let us take a quick look at what are life insurance plans and how do they work.
Decoding Life Insurance plans
Life insurance plans are a part of the plethora of insurance products available in the market. In simple terms, a life insurance plan is an agreement between the insurer and the insured where the insured pays a fee in the form of a premium on regular intervals to the insurer. In return to which the insurer guarantees a death benefit to the nominees of the insured.
As mentioned earlier the primary objective of purchasing a life insurance plan is to safeguard one’s family and loved ones against phases of financial instability arising due to the disability or demise of the policyholder. However, life insurance not only provides financial cushioning but also provides much-needed peace of mind to the insured.
There are numerous types of life insurance plans available in the market, the most common are as follows-
- Term Insurance Plans
- Whole of Life Insurance Plans
Points to Ponder while Purchasing Life Insurance Plans in the UAE
There are various important points to be pondered while purchasing the right life insurance plan for your family and loved ones. Here’s a rundown-
One of the most important points that are to be kept into consideration while purchasing life insurance plans in the UAE is their affordability. In order to ensure that life insurance plans pay you back when needed the most, you are supposed to pay premiums regularly. While choosing the ideal life insurance plan it is crucial to analyze the economic aspect of the plan to make sure that it does not absolutely wreck your pockets by adding financial burden over it. Affordability of life insurance is important in another way because when there is a financial crisis people usually tend to stop paying for life insurance plans in the very first place. Therefore buying an affordable will increase the probability of you sticking to the plan for a relatively long period.
No medical Examination
A lot of insurance providers not just in the UAE but all across the globe offer life insurance plans that can be purchased without any sort of medical examination. Very often, buyers get tempted and go-ahead for plans that are available without a medical examination. However, it is vital to be aware of the fact that plans that are available without a medical examination do not cover the insured immediately but after a period of two to three years.
Contrary to this, life insurance plans that are sold with a mandatory medical examination cover the buyer right from the moment of issuance. If you prefer to get coverage immediately after the purchase of your life insurance plan it is recommended that you should go for plans with a medical examination.
Providing the Right Information to the Insurer
While you apply for a life insurance plan, you are supposed to fill in a form that requires several details and documented proofs about your age, financial, marital and health status. In order to ensure that your policy is guaranteed payout when your loved ones need it the most, one should always provide correct information to the insurance provider.
When a nominee submits a claim, the insurance company investigates the scenario to conclude. If the insurance company finds out that any information mentioned on the application was not correct then there is a very high probability of claim rejection. Therefore it is vital to provide correct information to the insurance provider.
Add-on riders are additional coverage providing tools that allow users to enhance the strength of their plan. Add-on rider provides coverage over the basic cover of the plan in order to enhance the protection quotient of the basic plan. There are numerous add on riders that are available along with the basic life insurance plan. Critical and terminal illness rider, personal accidental coverage, waiver of premium, etc. are some of the most popular add-on riders.
Ease of Buying the Plan
Ease of buying a plan that comes first while purchasing life insurance in the UAE. The modern-day world is working online and so are most of the products. While purchasing a life insurance plan one should ideally choose plans that can be accessed online without any hassle. Hence buyers should also keep the ease and convenience of buying along with making payment into consideration.
In a Nutshell
Life insurance plans allow you to utilize your potential to fullest during the economically productive by securing your loved ones in the long run. It is always recommended that buyers should carry out research followed by a strategical analysis of their needs to get the best life insurance plan for themselves and their families.