Questions To Ask Before Buying Term Insurance | Fusion - WeRIndia

It is not necessary that the best term insurance for your friend is the best term plan for you. This is because the age and health of your friend may be different than you, which are important factors affecting the cost of the policy. The best term insurance policy for you would be the one that offers you maximum amount while charging you the least. However, the best term plan will also offer other additional. benefits.

Before investing in a term insurance, as a customer, you may face several doubts. You are committing to pay a particular amount for years so that your loved ones are able to get the policy amount in case of your unforeseen demise. This article contains answers to such questions below.

1. Would my policy cost more if I have a smoking history?

Smoking reduces the life of a person. Some insurance providers demand the prospective policyholder to disclose if they have been a drinker or smoker in the past and when did they leave it. Other providers accept people who have stopped smoking in at least three years as non-smokers.

2. Can the premium of term plan bought today alter in the future?

If there is no clause mentioned in the document regarding changing the premium with time, it will remain the same through entire term of your policy until no change is introduced by the policyholder. This means that the policyholder should not develop disability or life-threatening habit of smoking or drinking. In such a case, the company may choose to increase the premium.

3. What happens in the case of accidental demise?

The best term insurance pays in case of accidental death. Irrespective of the reason (natural, accidental, or illness), the cover amount or sum assured would be paid on the insured’s death. You can look for additional benefits or riders as well, such as permanent disability rider, accidental death benefit, critical illness rider, etc. to give a boost to the best term plan.

4. What would happen if I start smoking after some years of buying the policy?

In case the insured gets into the habit of drinking or smoking, or any habit that may reduce their life expectancy, they have to reveal this face to their insurance provider as they are a part of different risk pool. Otherwise, their provider may impose loading or increase premiums on current premium or may cancel the policy.

5. What happens if I don’t die?

You will not obtain maturity benefit if you do not die. However, your policy changes as it comes to the term end. For example, the premium may rise in the end if you choose to retain the policy. Moreover, you can upgrade your policy as it ends and get a new policy instead. If you do not need the policy by the time it ends, you may choose not to renew it.

The Bottom Line

Before investing in any policy, you must study the terms closely and ensure that you do not invest in a policy that does not fulfill your needs or is too expensive for you.

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