Guide to Choosing A Term Plan If It’s Your First | Fusion - WeRIndia

A life insurance policy is one of the best ways to provide your family with financial stability, even when you are not there to protect them. When it comes to financial coverage, each family has its own needs. Term plan has the flexibility and versatility that can cater to the financial needs of any individual. If you are thinking about getting a term plan, then this is the perfect guide for you.

1. Focus on your Needs

As we mentioned above, the financial needs of every individual are different. Therefore, do not choose the plan just because your friends have selected it; instead, focus on your needs. Choose a plan that is ten times your annual income.

With this approach in mind, you will be able to cover even during inflation and loss of employment to a certain degree. There are many factors that you need to think about before deciding on a plan. Your marital status, number of children, their age, education needs, etc., are some of the factors that you need to thoroughly assess prior to choosing a term plan.

2. Confirming your Coverage Period

The coverage period is an imperative facet, which you should not overlook. Your term plan should cover until the age when you wish to stay employed. Earlier people used to consider this age around 60; however, people today wish to work beyond this age as well. This is because people are marrying late and starting a family late.

If that is the case with you then, you can keep the tenure till 65 years of age. Moreover, it is always better to invest in a term plan at a younger age. The earlier you will acquire, the more will be your premium in the future.

3. Consider Inflation

In the case of inflation, the value of rupee would decrease, which will increase the prices of products. This means that your living expense will go up unexpectedly. Therefore, when taking the term plan, it is important to keep the inflation factor in mind. Some insurance companies offer hike coverage between 5% and 10% annually. Such periodic insurance in the assured sum will make sure that your family has the financial ability to deal with inflation.

4. Compare the Plan

There is a wide range of insurance service providers with distinctive plans. The options in front of you can be quite overwhelming; however, do not get lured in my marketing hype. Make sure you search for terms plans, both online and offline.

Moreover, thoroughly read through the offering of each provider and then compare the terms and conditions against each other. This way, you will be able to decide which plan is catering to your demands in the most effective manner.

Along with all the above factors, make sure that you choose a credible life insurance policy provider. Look out for the market reputation of the company. A credible company will always have a good claim settlement ratio and exhibit transparency and reliability from the outset.

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