Life insurance is one of the most important financial products you can buy to ensure the financial security of your loved ones in case of an unfortunate event. It provides a safety net for your family, covering expenses like mortgage repayments, daily living costs, and children’s education. With various life insurance options available in the market, choosing the right one can be a daunting task. Fortunately, platforms like PolicyBazaar make it easy to compare, evaluate, and choose the best life insurance policy according to your needs.
If you’re planning to buy life insurance, here’s a comprehensive guide on what you need to know before purchasing life insurance through PolicyBazaar.
Why Should You Buy Life Insurance?
Life insurance offers financial protection to your family after your death, ensuring that they are not burdened with financial obligations. Here are a few reasons why buying life insurance is essential:
- Financial Protection: It provides a lump sum payment to your family in the event of your death, which helps them maintain their lifestyle and cover financial liabilities like home loans or educational expenses.
- Tax Benefits: Life insurance premiums are eligible for tax deductions under Section 80C of the Income Tax Act. The death benefit is also tax-free under Section 10(10D).
- Investment Option: Certain types of life insurance policies, such as endowment or unit-linked insurance plans (ULIPs), also offer an investment component that can grow over time.
Buying life insurance through PolicyBazaar provides you with the convenience of comparing various plans and selecting one that best suits your needs and budget.
Key Things to Consider Before Buying Life Insurance on PolicyBazaar
Before purchasing a life insurance policy through PolicyBazaar, here are some important aspects to consider:
1. Assess Your Insurance Needs
The first step in choosing the right life insurance policy is understanding how much coverage you need. The general rule of thumb is to buy a policy with a coverage amount that is at least 10-15 times your annual income. You should also consider any liabilities, such as outstanding loans, and future financial goals like children’s education or marriage.
2. Types of Life Insurance Policies
PolicyBazaar offers various life insurance options. The most common types include:
- Term Life Insurance: Provides coverage for a fixed term, such as 10, 20, or 30 years. It’s the most affordable form of life insurance.
- Whole Life Insurance: Offers coverage for the entire lifetime of the insured, with the added benefit of building cash value.
- Endowment Plans: These plans combine both insurance and investment, providing financial protection along with a savings component that matures after a certain period.
- Unit-Linked Insurance Plans (ULIPs): These plans offer both insurance coverage and an investment option, where the premium is invested in different equity, debt, or hybrid funds.
- Child Plans: Tailored to meet the future needs of your children, including education, marriage, and other life milestones.
3. Compare Plans on PolicyBazaar
PolicyBazaar allows you to compare multiple life insurance policies based on different parameters, including:
- Premium Cost: The premium is the amount you pay regularly (monthly/annually) to keep the policy active. The amount you pay depends on factors like your age, health condition, and sum insured.
- Policy Tenure: Choose a policy tenure that suits your needs. For instance, if you want coverage until your retirement, you may prefer a long-term plan.
- Claim Settlement Ratio: This is the ratio of claims settled by the insurance company. A higher claim settlement ratio indicates that the insurer is reliable in honoring claims.
- Customer Reviews: PolicyBazaar aggregates reviews from real policyholders, giving you an idea of the insurer’s customer service and overall satisfaction.
4. Examine the Policy Terms and Conditions
It’s crucial to thoroughly read the terms and conditions of the policy. Pay attention to exclusions, such as suicide clauses, waiting periods, and the fine print about claims.
5. Choose a Reputed Insurer
While PolicyBazaar offers a range of insurers, it’s important to choose a provider with a good reputation for customer service and claim settlement. Look for insurers with high claim settlement ratios, positive customer feedback, and strong financial backing.
6. Understand Premium Payment Options
Most life insurance plans allow you to pay premiums annually, semi-annually, quarterly, or monthly. Depending on your financial situation, choose a payment option that’s most convenient for you.
7. Add Riders for Extra Protection
Riders are add-ons to a basic life insurance policy that provide additional coverage. Common riders include:
- Critical Illness Rider: Provides a lump sum payout in case of a diagnosed critical illness like cancer, heart attack, etc.
- Accidental Death and Disability Rider: Pays a benefit in case of accidental death or permanent disability.
- Waiver of Premium Rider: Waives future premium payments if you become disabled or critically ill.
How to Buy Life Insurance on PolicyBazaar
Buying life insurance through PolicyBazaar is a simple and straightforward process. Follow these steps:
- Visit the PolicyBazaar Website: Go to www.policybazaar.com.
- Select Life Insurance: Choose the life insurance category from the list of products.
- Enter Your Details: Provide personal details like your age, gender, health status, income, and coverage requirements.
- Compare Plans: Use the comparison tool to view various life insurance plans side by side.
- Choose the Best Plan: Select the policy that fits your needs based on premium, coverage, and insurer.
- Complete the Application: Fill out the application form and submit the required documents.
- Payment and Confirmation: Once your application is processed, you can pay the premium, and your policy will be issued.
FAQs: What You Need to Know Before Buying Life Insurance Through PolicyBazaar
1. What are the types of life insurance available on PolicyBazaar?
PolicyBazaar offers various life insurance plans, including term life insurance, whole life insurance, endowment plans, unit-linked insurance plans (ULIPs), and child plans.
2. How do I compare life insurance plans on PolicyBazaar?
To compare plans, visit the PolicyBazaar website, enter your details (age, gender, coverage amount), and use the comparison tool to review various policies side by side based on premium, claim settlement ratio, coverage, and more.
3. What factors affect life insurance premiums?
Life insurance premiums are influenced by factors like your age, health condition, lifestyle, occupation, sum insured, and the type of policy you choose.
4. What is a claim settlement ratio, and why is it important?
The claim settlement ratio represents the percentage of claims an insurer settles out of the total number of claims received. A higher ratio indicates the insurer’s reliability in paying claims.
5. How can I pay for my life insurance premium?
You can pay premiums annually, semi-annually, quarterly, or monthly depending on your preference and the insurer’s options.
6. Are riders important in life insurance policies?
Riders are optional add-ons that enhance the coverage of your basic life insurance policy. Adding riders like critical illness or accidental death can provide extra protection at an affordable cost.
7. Can I change my life insurance plan after buying it?
Yes, you can modify your life insurance policy after purchase. However, this may require adjusting the sum insured, policy tenure, or adding/removing riders.
8. How can I cancel my life insurance policy on PolicyBazaar?
If you wish to cancel your policy, contact the insurer directly or visit PolicyBazaar’s support section. They can assist you with the cancellation process and guide you through any refund procedures.
9. Is there a waiting period for life insurance claims?
Life insurance policies generally have a waiting period, especially for certain conditions like suicide (usually within the first year). Always check the waiting period clause in the policy document before buying.
10. Can I buy life insurance if I have pre-existing medical conditions?
Yes, you can buy life insurance with pre-existing medical conditions, but some insurers may impose a waiting period for coverage related to these conditions or charge higher premiums.
Conclusion
Buying life insurance is a crucial step in securing the financial future of your loved ones. By using PolicyBazaar to compare plans, you can find a policy that fits your coverage needs and budget. Whether you’re looking for term life insurance, whole life insurance, or ULIPs, PolicyBazaar’s user-friendly platform makes the process easy and transparent. Be sure to evaluate your options carefully, understand the terms and conditions, and choose the right plan that offers adequate protection for you and your family.