Life insurance products are one of the most critical investments and probably the least understood financial product. With adequate life insurance, you can protect your family against life’s uncertainties by providing for them, even in your absence. Additionally, these policies also allow you to meet your future financial goals and to earn a return on your investments to create a corpus of funds from long-term investments.
Buying a life insurance policy is a critical financial decision. Despite its importance, research indicates that only 10% of Indians get a life cover. If you are wondering why the insurance is essential, then the answer is the future’s unpredictability. Regardless of your current financial status and your existing income, it is impossible to predict what will happen in the future.
Believe it or not, in the last few years, more and more people are losing their lives to lifestyle diseases such as cardiovascular ailments and diabetes at a young age. So if you are a sole earning member of your family, it is all the more necessary for you to step up and take responsibility for your loved ones while you still have time. Doing so will help them get on with their lives, even if you are not there to provide anymore. Besides, life insurance death benefit can be used to pay off debts and maintain the same standard of living.
You shouldn’t underestimate the importance of life insurance if you want to keep your loved ones safe from life’s uncertainties. It would be wise to use the life insurance calculator to determine the amount of life cover that you would need to secure your family’s financial future.
The right policy offers vital protection to your loved ones in case of your untimely demise. But apart from the apparent financial assistance, there are many other reasons to buy a life insurance policy. Here are the key factors that will help you understand life insurance and its importance.
- Coverage Amount
Did you know that when buying life insurance, underinsured is as good as not insured? This is why the insurance providers facilitate you with a life insurance calculator so that you can calculate the right coverage amount while making a purchase decision. This is important because inadequate coverage amounts will be unable to provide the necessary financial cover to your family members, thereby defeating the purpose. At the same time, over-insurance would mean high premium costs that will be difficult to sustain for an extended period.
Since life insurance is a life-long commitment, you must use the insurance calculator to calculate the monthly premiums of the policy you want. The right policy decision will be the one where you can find the perfect coverage amount at the premium you can afford throughout the policy term.
- Coverage Period
This is another crucial factor in the purchasing of a life insurance plan. The coverage period means the duration for which you will stay insured. Choosing the right coverage period is an essential consideration in the premium calculation as well. You can use the life insurance calculator to see that longer policy duration will make the premiums more affordable. Besides, the longer you stay invested, the higher your returns will be. Preferably, the life insurance cover duration must be throughout your working years.
- Plan Features
Once the coverage amount and the policy duration are out of the way, the next consideration in the process of choosing the best life insurance policy is the plan features. When you use the insurance calculator to calculate the premium, you must take one additional step to compare the plan features against the payable premium to ensure that you are getting the best value for your money. Ideally, you must select a robust life insurance policy with suitable features at an insurance premium that you can afford.
- Available Rider Options
All the life insurance products are eligible for rider benefits. It is the best way to customize your policy and personalize it as per your lifestyle. You can look at various rider options such as critical illness health cover, waiver of premium, and disability rider, among others, that can be attached to your policy. You can add many riders to your policy as you want by paying a small fee that will be added to your premium. However, be sure to use the life insurance calculator to see if they are affordable.
- Claim Settlement
Once you have found a suitable life insurance product for your investment portfolio, you must only buy the policy from a trusted insurance provider. You can establish a life insurance provider’s market reputation by checking the claim settlement history. The history is denoted in a ratio that reveals the number of claims paid by the service provider against the number of claims raised. Make sure that your insurer’s claim settlement ratio is in the 90s.
If you are planning to buy the right life insurance policy, it is advisable to compare different plans online. Online insurance plans from reputable insurers such as Max Life Insurance enable you to use the life insurance calculator to calculate premiums and compare policies to find the one that provides maximal benefits at cost-effective premium amounts.