How to choose and buy a best life insurance 2022-2024

Life insurance is the contract between insurance company and policy holder. In case of death of policy holder insurance company pays the sum assured to the policyholder on the promises of paying amount as per agreement. Policyholder also choose the different options add-ons and extra costs.

How Life insurance work ?

– The person who wants the insurance they choose Life insurance as per their requirement and
stability. Some amount of documents are give to the insurance company. policyholder have to pay a fixed amount every month for a certain period of time.

– Under the Life insurance policy, if the policyholder dies then death of benefit equal to the total sum assured amount is paid to the beneficiary of the policy.

– The beneficiary will have to file a claim to receive the benefit. In the claim have to submit the death certificate

How to buy Life insurance?

– Main insurance companies from where you can get Life insurance. You can also get insurance by going to companies and if you want, you can also apply online.

– You can also send a request for Life insurance to the companies Toll Free Number. You have to fulfill some of their conditions like your age should be between 20 to 60 years. You should not be suffering from any kind of deadly disease and at the sometime be mentally healthy.

Why take Life insurance?

– We don’t know what happens in a life.
– Accidents happens everyday, so life insurance is a must important for every person.
– lf you unfortunately have an accident and you have signed a contract with Life insurance then you can avail its benefits
– If you want to protect and secure your family after your death, then it’s a very safe way for you. so with this article focuses on how to buy and choose the best life insurance.

How much Life insurance should be taken -:

How much Life insurance you should take depends on your annual income, how many liabilities you have, how many people in your family depend on your income. You should take a life insurance cover amounting to 10 to 15 times your annual income.

Type of life insurance policy -:

There are also some type of life insurance such as term insurance, endowment policy, unit linked insurance plan etc.

1. Term insurance policy

– Term insurance policy is for ater period. E.g 20 yr, 30yr
– Term insurance premium are very low and offer better insurance coverage.
-In term insurance policy maximum coverage and minimum premium are provided to policy buyer
– If the policyholder dies within the stipulated time, his nominee is then paid. But policyholder are alive after the deadline, policy holder do not get the benefit.

2. Whole life insurance-

– These policy are valid for lifetime.
– In whole life insurance policy maximum coverage provide to policy holder and very high premium paying to the insurance company
– In order to insure life, the policy borrower will decide that he will pay for the fixed time or he wants to pay till he is alive.
– After death of policy holder the nominee will receive a guaranteed amount.
– Premiums are fixed and never go up regardless of market conditions.
– You may be able to withdraw funds or take out a loan.
– Date benefits is guaranteed as long as you made the required premium payments

3. Endowment life insurance policy-

– Endowment policy Life insurance is available till the time fixed. along with that you get a fixed amount.
– Endowment policy could be used to create a risk -free saving Corpus and provides financial protection to the family in case of any unforeseen event.
– In endowment policy substantial amount you receive at the death of the policy holder, when your endowment policy matures .
– The money receive his nominee once they claim for it in case of your untimely death. This is equivalent to the life insurance policy cover.
– Endowment insurance plans also offer tax benefits. The premium you pay can help you reduce your taxable income as per indias income tax laws.

4.Unit linked insurance (ULIP)

– Unit linked insurance policy are insurance products in which you get investment options along with Life insurance can invest in debit, equity , hybrid fund through investment options.
– Unit linked insurance policy is an insurance plus investment product.
– Two type in unit linked insurance policy
   – Premium term-
     How many days will keep paying premium it’s included. Premium can be single pay or fixed duration that means 5,7,10 can be years old or regular pay that is, in the policy term, you will keep paying your premium at regular intervals.
  – Policy term –
     How many days will your policy be valid is included in policy term. The policy term can range from 5 to 30 years depending on the premium term

What is the premium payment mode/frequency in ULIP mode?
– You can pay an amount in a single pay policy. In fixed duration policy can pay yearly amount and half duration can pay two times in a year, in quarterly three times in a year and you can pay also monthly.
– The sum assured is an agreement between the insurance company and policy taker.
– If the policy taker has an accident for which you have taken this policy, then you will definitely get the sum insured amount.

which insurance to take -:

Policy taker can consider the few points

– To take maximum coverage
– As much as possible minimum premium
– Settlement ratio

The Term plan insurance are better than the other life insurance plan . why ?

It gives maximum coverage in minimum premium.

Explain with an example- let me share an example with you let’s say, you want a coverage of 10 million. If you go for term plan then you get it in 7000 rupees but if you go for endowment policy then you get then coverage of 10 millions in 15000.

You can afford only 15000 so you think that you should go for endowment because you are getting 10 million but way to think about this is that if you take a term plan which is taking only 7000 rupees you are saving 8000 rupees per month because that is what you could afford. If you invest these 8000 rupees in mutual funds, small business, stocks then most likely you will get better returns than this endowment plan.

 

 

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