The Parameters to Evaluate and Compare Life Insurance Plans

The Parameters to Evaluate and Compare Life Insurance PlansPolicybazaarAverage Rating / 5 ( reviews)
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Life insurance plans offered by the insurance providers in the market offer the policy seeker with a wide array of options to choose from for both the plan and the payout of the plan. Considering the variety of attractive benefits that are offered by each of the insurance providers out there, it can seem like a terrifying task to find the right insurance policy that suits your needs and requirements.

Therefore, to help you in this search for the perfect life insurance policy, here are 7 parameters listed that will help you to evaluate and compare life insurance plans available by the various providers.

The Payouts Offered

The payout that is offered by a life insurance plan is largely dependent on the life coverage type of policy you buy. For instance, term insurance plans offer a lump sum death benefit to the nominees if the insured individual passes away during the term of the policy. On the other hand, a cash value policy offers a death benefit if the policyholder passes away, along with a maturity benefit if the policyholder manages to survive the tenure of the policy, and in some cases even survival benefits during the tenure of the policy (if pre-decided).

Thus, it is important for you to make sure to compare life insurance plans and the payouts that are offered under the ones you have shortlisted. Only pick a policy wherein the payout that is offered matches your needs well.

The Pricing Of The Policy

The manner in which a policy is priced is quite important, and ideally, you should select a policy that offers you sufficient coverage at an affordable price. The different insurance providers in the market consider different factors that help them reach the premium that is charged on a policy. Usually, the rate of premium that is offered to you on your policy represents the risk that the insurance provider will be facing by providing you with the coverage policy.

Some of the factors that can influence the policy’s premium are the entry age of the insurance seeker, the sum assured that is chosen, the medical history of the buyer, the additional riders opted, the tenure of the policy, among other things. You can compare life insurance plans and the premium quotes of the insurance providers by visiting the website of the insurance providers or by contacting the insurance providers on the dedicated helpline numbers.

Claim Settlement Ratio Of The Provider

The claim settlement ratio of an insurance company refers to the total number of claims that the company has settled against the overall number of claims that the company has received in a financial year. Hence, a high settlement ratio indicates the willingness of the insurance provider to settle claims. This should be one of the key parameters that you should look out for when you compare life insurance plans from different providers.

Ease of Purchasing The Policy

Most of the insurance companies these days offer insurance policies via both online and offline platforms. It is always better to have the option to choose to buy your insurance policy via an online channel, be it directly through the website of the insurance provider or through a trusted website of a third-party since the process is much easier and does not cause any hassle. Additionally, you should also look out to check if the insurer provides you the option to renew the insurance policy online.

Ease of Payment of Premium

When the traditional approach was followed, the policyholders had to visit the insurance provider’s branch all the way to pay the outstanding amount. However, these days the policyholders also have the option to pay their dues via the insurance provider’s website through net banking, debit or credit card, etc. in a manner that does not cause any hassle. Therefore, when you are searching for insurance policies, it is important to check the payment process for the premiums due and the various payment channels that the provider offers. 

Average Time Taken By The Provider to Settle The Claims

Generally, once the claim is raised by the nominee and the relevant documents have been submitted for the same, the insurance provider takes the time of a few days in order to verify the documents submitted and settle the amount for the claim.

Therefore, you should check the average time period that is taken by the different insurance providers to settle the claims made with them when you compare life insurance plans. It is ideal to opt for an insurance provider that settles their claims in a manner that is timely and quick. This will ensure that your beneficiary or beneficiaries do not face any complications amidst the claim settlement process.

The Reliability Of The Provider

When you are in the market to purchase an insurance plan, it is important to do thorough research about the insurance company that you are choosing on top of just reading and researching about the policy you are choosing. Thus, keeping this mind, you should ensure to check when the provider came into the business, the customer service platforms that they provide, the number of branches that they have across the country, the grievances solved and the claims settlement ratio of the company, customer reviews across the online platforms, etc. Keeping a check on these factors when you compare life insurance plans will give you a good idea about how reliable the insurance provider is.

The Final Say

Buying a life insurance policy is an important financial decision and it is one that requires a great deal of your time dedicated towards research. Before opting for any plan, make sure that you properly assess your requirements and then move onto picking a product type as per that.

On top of that, make sure that you compare life insurance plans on the basis of the parameters that are mentioned in this thread so that you make an informed choice. You should aim at choosing an insurance plan that does not only meet your needs and requirements but also has a premium rate that is affordable.

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