Which Term Insurance is the Best?

A term insurance plan offers you a large cover at a very affordable premium. Many term insurance plans are now available online for a lesser price as compared to offline with exactly the same benefits. With insurance aggregator websites like coverfox.com, it has become extremely easy to compare term insurance plans offered by different life insurance companies. The big question here is, “How to filter out the best term plan from so many options”? Below are some of the important points and features you should consider to filter out the best term insurance plan for yourself.

Claim settlement ratio

One of the important qualities of the term insurance is that it releases the claim payment quickly and without much hassle to your loved ones in your absence.  The claim settlement report card of the company can be assessed by the claim settlement ratio of the life insurance company. Claim settlement ratio is the number of death claims approved by the insurance company divided by the number of claims received by the insurance company. It is normally measured for a period of one year. The data is released by the Insurance Regulatory and Development Authority of India (IRDA) to the general public every year and is available to see on the official website of IRDA.

For example: Suppose an insurance company received 1000 death claims between 1st April, 2018 and 31st March, 2019. Out of this, it paid 900 and rejected 100. Then, the claim settlement ratio of the company will be 90%. All the claim settlement ratios are mentioned in percentages. Claim settlement ratio is simple to understand and plays a vital role in assessing the claim settlement history of the company. It also shows the quality of the claim settlement process of the company. The higher the claim settlement ratios, the better are the chances of a claim being honoured by the life insurance company.

Claim Process of the Company

Companies that have a simple-to-understand claim settlement process, may have a higher claim settlement ratio. The ease, understanding and support in filing the claim, will get the claim settled quicker as opposed to a complicated process. If the process is streamlined and seamless, it will help the claims department to come to a decision on claim settlement quicker. High claim settlement ratio means the insurer is reliable and can be trusted for taking term plans. Whereas the low claim settlement ratio can be a sign of inability of the insurer to settle the claims.

Claim Pending ratio

The claim for which the decision is pending is known as claim pending ratios. If the claim pending ratio of the company is high, it can be an indicator that the claim settlement process is slow and painful. You should also consider how many days it takes on an average for a company to settle a claim. Normally major life insurance companies take anywhere from 7 days to 15 days to settle a claim from the day of the submission of the last necessary document. In rare cases, the claim settlement might get delayed due to the extended investigation in the case or non-availability of the required necessary documents as stated in the terms and conditions of the claim settlement process of the life insurance company.

Rider options

Nowadays, many life insurance companies are offering valuable riders for an additional premium. You can have a look at the different riders offered by the company and select the ones that are best-suited to your individual needs. Riders can help increase the value of the term insurance plan and prove beneficial to you. For example: Disability rider gives a lump sum amount and eases your financial burden by waiving off all future premium if disability occurs to the insured due to an accident or sickness.

Variety of term insurance plans

Based on your needs and requirement, there are different types of term insurance plans to choose from. Regular term plan, return of premium term insurance plan (TROP), decreasing term insurance plan, increasing term insurance plan, convertible term insurance plan, group term insurance plan. Every person has a different requirement as per their individual case scenario.

Flexibility, coverage and features offered by the term plan

The best terminsurance plan will have good options like flexibility in premium paying options, option of having a lump sum payout or regular monthly income etc. Some term plans offer coverage more than the life expectancy age in India. This can work out in your favour as your family has a higher chance of getting the sum insured.

Premium of the term insurance plan

Premium is one of the most important features we look for alongside other things. Almost all life insurance companies are offering their best term plans online and the premium works out to be cheaper than offline plans. As it is a long-term investment, make sure the premium fits in your long-term financial goal investment. Non-payment of premiums during the policy term can make your policy void and leave you uninsured.

Brand

Although it is not the biggest factor, but brand of the life insurance company can give you the peace of mind that your investment is with a reputed company, especially if you had good experience of their services in the past.

Considering the above points, you can compare and filter out the best term insurance plan for yourself. As one size does not fit all, same is the case with term insurance plan. Based on the individual requirements, the term plan will be considered best term plan if it works as per the expectation of the insured and its family. Choosing the best term plan is dependent on the selection of the person planning to buy the plan. Today, the internet offers tools that help compare the features of the top term insurance plans available in the market. Just by putting a few essential details, the individual can get customized results of the best term plans available in the insurance market. Moreover, online premium calculators can be used to assess the premium calculations of these best term plans to ensure they fit nicely in the monthly budget. Availability of the new age sophisticated tools makes buying term plans easy and convenient. So, now that you are equipped with some solid pointers to get you best term insurance plan right away, it is the best form of cover you can gift to your loved ones.