Choose Suitable Life Insurance Plan Not The Cheapest.
With increasing number of insurance products in the market, customers enjoy a wide array of choices. Many competitive products are being offered; some at comparatively lesser rates as well. Predictably, many of us also prefer products which are cheaper. However the question we need to ask ourselves is – whether every cheap product is good?
Life Insurance, one of the most crucial of all the products are available in a wide range; each plan with something unique to offer. Insurance companies are in a competition to lure consumers with attractive features. Although most of the features are beneficial to us we do need to evaluate thoroughly before finalising one.
We tend to go for the cheapest plan possible. The reason being the popular belief and the advices that are offered to us, again and again! There is nothing wrong in choosing a cheap plan. However what we need to consider is whether that is the only deciding factor? Should rates of the product be the only criteria we need to follow?
Let Us Discuss Why?
Buying a life insurance, unlike any other product affects our entire life. That is the reason why it becomes even more important to be careful while purchasing. There are a few things which we must keep in mind before buying a life insurance plan.
Here are a few ways which can help you in making an informed decision. First review all your insurance needs. Understand what your requirements are; Plan for your future and for your family. Decide whether you want to buy a term insurance or a permanent insurance. Term insurance offers cover for a stipulated period of time while permanent insurance offers cover as long as you pay the premiums.
Evaluate your financial condition – check whether you have any debt or mortgages. Decide on the amount of coverage you would want and for how long. Decide on the amount of premium that you will be able to pay regularly. Whether you have any dependents or not; whether you need to provide financial support to your family. If in case something unfortunate happens, how much of financial support you must provide to ensure a financially stable life for your children, parents and spouse. These are just a few factors that can influence your purchase of life insurance policy.
Rates of plans may vary from one company to other. However, for a suitable product, one must consider above mentioned variables along with looking in to the cost of the plans. A life insurance is to help us at times of need. Hence, we shall buy a product which fulfils our requirements on time and in ways we would prefer.
A life insurance policy is a contract with an insurance company. In exchange for premium payments, the insurance company provides a lump-sum payment, known as a death benefit, to beneficiaries upon the insured’s death.
Typically, life insurance is chosen based on the needs and goals of the owner. Term life insurance generally provides protection for a set period of time, while permanent insurance, such as whole and universal life, provides lifetime coverage. It’s important to note that death benefits from all types of life insurance are generally income tax-free.1 There are many varieties of life insurance. Some of the more common types are discussed below.
Term Life Insurance
Term life insurance is designed to provide financial protection for a specific period of time, such as 10 or 20 years. With traditional term insurance, the premium payment amount stays the same for the coverage period you select. After that period, policies may offer continued coverage, usually at a substantially higher premium payment rate. Term life insurance is generally less expensive than permanent life insurance.
Needs it helps meet:Term life insurance proceeds can be used to replace lost potential income during working years. This can provide a safety net for your beneficiaries and can also help ensure the family’s financial goals will still be met—goals like paying off a mortgage, keeping a business running, and paying for college.
It’s important to note that, although term life can be used to replace lost potential income, life insurance benefits are paid at one time in a lump sum, not in regular payments like paychecks.
Whole Life Insurance
Whole life insurance is a type of permanent life insurance designed to provide lifetime coverage. Because of the lifetime coverage period, whole life usually has higher premium payments than term life. Policy premium payments are typically fixed, and, unlike term, whole life has a cash value, which functions as a savings component and may accumulate tax-deferred over time.
Needs it helps meet: Whole life can be used as an estate planning tool to help preserve the wealth you plan to transfer to your beneficiaries.
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Mera Insurance Wala
Mera Insurance Wala (MIW) is one of the pioneer Insurance Company offering wide range of insurance products according to the specific needs of the clients. Established in the year 2012.Be it advising on the right insurance product or identifying & managing the risks involved, We makes sure the investments are done wisely as per the interests..know more