How to Pick the Right Life Insurance Plan

 

When it comes to life insurance it can get very tricky at times to decide as to which plan is the most fit plan for you and all your needs. Currently, in the private sector in India, many companies offer fantastic plans, which may seem attractive at first but you need to ask yourself:

Is this the right plan for me?

This article will help you understand the most basic products that are available in the insurance industry. By understanding the basic products, it will help you get a clearer picture of the more complex product offerings in the insurance market.

Life insurance products:

• Term Plan: Protection of family

• ULIP: Unit Linked Insurance Plan for your market related investments

• Whole Life Plan: Life cover to the life assured for whole of life

• Endowment Plan Insurance savings plan

Regardless of your age, income, sex, etc. It is very important to understand that life insurance is one of the essential investments that you will ever make. Considering the amount of risk and uncertainties that we have encompassing us, planning ahead and choosing the right policy is vital and important.

But while we pursue this investment opportunity, we also need to consider some factors that should be kept in mind while we pick a Life insurance policy.

Factors:

• Premium amount

• Time Duration of Payment

• Type of insurance opted for

• Your requirements as a policy holder

Premium amount:

While you go for the option of life insurance, always make sure that you absolutely know about the premiums that you are paying.

How much will I be paying per month?

Will this Premium amount stay fixed or will it change?

These are some of the sample questions that you should ask your insurance representative, while you are buying a Life insurance Policy. You may ask more questions, according to your curiosity.

Time Duration of Payments:

Knowing the time duration of your premium payments, is of utmost importance as it would help shield your capital and help you to plan out your payments more diligently. Being thorough with your premium payment period is a big YES.

Type of Insurance:

Knowing about what kind of plan you want to go for, goes a long way. Once you have a clear idea of what kind of Life insurance you would like to go for, it makes it so much easier to dig in deeper and find a plan that is more suitable to your specific needs.

Requirements as a policy holder:

Being clear with what your needs are with the Life insurance policy, is more than 50% of the work done. For example, If a young working professional, who has his parents as dependants on him should look into investment into a TERMplan. Why you ask? As he may want to look for different plans of insurance for investment but as of now his primary need is a life cover, so that if unfortunately something happens to him, his parents should be covered.

Similarly, it is of utmost importance that we plan ahead and decide as to what we want from a Life insurance policy and what we expect back from it.

Written By Priyansh Koul (HDFC Life)

ARN: ED/07/19/14722