What To Look For In Your Insurance Contract
Life insurance is the only financial tool which offers the triple advantage of risk coverage, long term savings, and tax benefit. It offers financial protection to an individual after taking into account the present and future value of his assets and liabilities. However, consumers need to develop a better understanding of the life insurance products that they buy
There are a number of things that you must understand regarding your life insurance policy and this document is a guide to help you check the same.
Mentioned below are 10 key parameters to weigh once you receive the policy document.
Verify personal details
Personal data provided to the life insurance company forms a very important part for policy servicing and settlement of all claims.
Please make sure that all personal details such as your name, age, address, etc. are mentioned correctly.
Moreover, do be certain that all aspects related to personal habits or health details are mentioned correctly as per the disclosures made by you in the proposal form.
Analyze the benefits
The benefits of your life insurance policy must correspond with your long-term goals. After the receipt of policy document, go through the features and benefits of the product and check if they match with promises made during the purchase. Cross-check features such as sum assured, premium amount, flexibility of the plan, etc.
Check the riders
In addition to life coverage, you may have purchased add-on covers known as "riders" for other types of contingencies. Go through the insurance contract to understand the ridercoverage.
Consider the payment tenure
Please check for how long you need to pay premiums and also what mode of payment you may have chosen, for example half yearly, quarterly, annual, etc.
You may sometime get a wrong advice like "you need to pay for only 3/5 years". Please do not fall for such advice. Life insurance is a long-term savings and protection tool and its benefits can be seen only if one buys it for the long-term.