Buying life insurance is an indispensible aspect of one’s life. Availing this policy shows that the person cares for his/her dependents and is willing to do all things possible to ensure they are kept safe and financially secure even in case of their untimely death. In the past, availing a life insurance policy would take days on end. It would also involve a significant amount of effort since people had to visit the offices of life insurance providers to collate the details about the policy as well as fill up the application form and avail the insurance of their choice. However, today, thanks to the internet, it is possible to accomplish all these tasks with minimal effort in a short span of time. But before you sign up for any life insurance policy, there are a few things that you will have to consider.
The primary aspect to consider is the sum assured. This is the amount of money that your dependents will get in the event of your death. There are certain ground rules while deciding the optimum sum assured. If the person is below 40 years, then the sum assured has to be at least 15 times their current annual income. For people in the age groups of 40 to 45 years, the sum insured has to be 10 times their annual income and in case of those above the age of 45, at least 5 times the current income is recommended. However, you can either consider opting for lesser or higher amounts based on your requirements.
Policy term is nothing but the duration of the policy. The duration of the policy varies based on the type of policy chosen. If you are below the age of 30 or 35, it is recommended that you purchase a policy for a longer duration so you get the benefits around the time of your retirement. However, you can also consider opting for more than one short term policies based on the features and benefits each of them offer.
While most of the life insurance policies offer the sum assured at the end of the term, there are a few extra riders that customers can opt for based on their requirements. However, it is important to remember that these riders come at an extra price. Therefore, it is imperative to consider opting for them only if they are necessary. For example, if you are relatively young and do not have any health ailments, signing up for health care benefits is not recommended. However, if you travel a lot and foresee high risks, it is worth considering riders such as permanent disability benefits or critical illness benefits.
Life insurance provider
The life insurance company you choose also makes a difference. Do not sign up for an insurance policy from a company just because of the lowest premiums. The repute of the company and their credibility in the market is a very important factor since these policies are long term policies.