Things to know Before Buying a Life Insurance

Things to know Before Buying a Life Insurance

Author: CANARA HSBC OBC

When it comes to buying a life insurance policy, various factors need to be kept in mind especially if you’re buying one for the first time. Just like investing in any other financial product, purchasing an insurance policy for the first time can also appear to be a complex and intimidating process. Various questions and doubts like, What is the best plan? Which is the best insurance company to buy from? How to choose a plan?” etc. can crop up and make the entire process a complex exercise. But, there is no need to worry. Here are a few tips that will assist you make in taking an educated decision for buying a suitable insurance plan.

Know your requirements

Before you dive in to buying an insurance plan, assess your needs thoroughly. The cost of an insurance plan depends on a variety of factors like your age, health, amount of coverage etc. These factors also play a vital role in determining the right insurance plan to buy.

Carefully choose a beneficiary

It might sound like a no-brainer, but many people make mistakes of choosing a wrong beneficiary. A beneficiary is a person who will get access to your entire insurance cover and therefore, he/she has to be someone who is absolutely trustworthy. It is also necessary that you keep your beneficiary informed about the insurance plan and its salient features

Amount of coverage

Before deciding on the amount of coverage you need to answer the following questions:

  • How much money do I earn?
  • Am I single or I have wife and kids?
  • How is my health?
  • How many people are financially dependent on me?
  • Are there any debts my family will have to pay when I’m gone?

Based on the answers to these questions the amount of coverage required can be decided.

Provide accurate & correct information

There is no point in withholding or providing incorrect information to your insurance providers. This will only lead to problems at the time of claim settlement. Even minor piece of misinformation is enough for your claim to get rejected. Therefore, be truthful with your insurance company, give accurate and correct information.

Understand the renewal policy

Most term insurance plans can be renewed for at least one term or more. It is important to check the age limit for renewing a policy.

Compare

All plans have something unique to offer. Therefore, don’t be in a hurry to purchase an insurance policy. Compare various plans offered by different insurance companies and select the one that is most suitable to your needs.

Ensure your financial stability to cover the cost of insurance

Once you buy an insurance plan, it becomes extremely crucial to pay the premiums on or before the due date. Therefore, before buying a particular plan, you need to be absolutely sure of your economic situation and about the fact that you’ll be able to pay the premiums on time.

These were the things that you need to be sure of before buying a suitable life insurance plan. Once you are done with the planning and are ready to make a purchase, you can compare various life insurance policies offered by Canara HSBC OBC Life Insurance here.

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