- Personal Finance»
How to choose a Term Plan in India
The popularity of term plans is increasing at a fast rate in India. A number of private companies are offering term plan for Indian people. In fact, some of the companies are also offering online term plans where you can get the plan through the official website. All you need to do is to visit the website, fill all the details and make the payment. This whole process might sound simple but one may get confused while selecting a term insurance plan. There are a number of factors to consider like the amount of cover to choose and the insurance provider to go for. This post describes in detail regarding how to choose a term plan in India.
Which is the best insurance company for Term Insurance in India ?
It is very hard to judge a particular company as the best insurance provider. You should consider some factors before choosing a company for term insurance plan. Firstly, you should analyze the claim settlement ratio of the insurance provider. This ratio tells that how many of the past clients succeeding in getting their claims. You should prefer a company with higher clam settlement ratio. The next thing is premium and it also differs from company to company. On an average, you will have to pay 6-8000 for an insurance of Rs 5000000 if your age is 30 yrs. The highest premium imposed on term insurance is that of LIC but with LIC you can be confident that your family receives the compensation, if something unfortunate happens.
How much cover to choose for Term Insurance
This depends on your budget and lifestyle. If you have a good lifestyle and income above 5 lakhs annually, you should choose a term plan of 50 lakhs or above. For term plans above Rs 5000000 medical tests are required and the premium is also less. You should choose an amount as insurance cover that is sufficient to support your family in case you die during the insurance period. You should also keep your budget in mind otherwise if you fail to pay premium on time, the policy may get lapsed. You should also keep the inflation in mind while selecting the insurance cover for term plan.
I hope this post helped you to understand the different factors that one needs to consider while buying a term plan in India.