Buying a life insurance policy means understanding different insurance jargon and policy terms well. If you have started planning for your future, this can be challenging to do. Therefore, insurance providers assign agents who can help the policy buyers with the purchase process. However, as a smart investor, it is in your best interest to do your own research.
Online facilities like term insurance calculator have made it more convenient to map your financial requirements. You can have a clearer vision of your financial plan by using an online term insurance calculator from the comfort of your home. It gives you more control over the information you wish to disclose and gather for purchasing insurance.
Not to mention that agents working for an insurance company may not tell you some crucial factors to be considered. While convincing you to buy a particular insurance plan, they may not mention certain things that you should know.
Nevertheless, you can take the initiative by using a term insurance calculator and strengthening your knowledge of insurance. To use a term insurance calculator effectively, you should be aware of the following things:
- Insurer’s CSR
You buy an insurance plan to provide for your family in case of an unfortunate event. The term insurance calculator helps in estimating adequate financial compensation for your loved ones to manage their expenses comfortably. However, the claim for settlement must be processed swiftly and without complications by the insurer for that to happen.
The Claim Settlement Ratio (CSR) of insurance providers is the number of claims paid against the total number of claims filed in a year. The total claims paid by the life insurance companies can be checked in the IRDAI report. It indicates the insurer’s reliability in providing financial assistance to your family.
The higher the CSR of an insurer, the better chances are of successful claim settlement. When you are evaluating the sum assured for your family with a term insurance calculator, you should also look at the CSR of the company. If they have a high CSR, it gives you the confidence that your family will receive the benefits.
- Comparative Benefits of Different Plans
There are several insurance options available in the market today. It can get overwhelming to choose a suitable plan for your family. Firstly, you must begin by understanding what is term insurance plan and its features appropriately. A standard insurance plan offers a death benefit in case the insured person passes away.
But there are term insurance plans with extended features of return of premiums, different riders, and many others. Using a term insurance calculator to compare the benefits and the prices of different policies can be helpful. You can make sure that you are well informed and prepared by familiarizing yourself with term insurance benefits.
When you estimate the sum assured with different online term insurance calculators, it gives you an idea of the cost structure. You might even find a feature that you had not previously considered. This way, it can help you realize the comparative benefits of different insurance policies.
- Exclusions Under A Plan
What an insurance agent might not explicitly tell you is that there are certain conditions that the plan may not cover. For instance, a standard term insurance plan may not offer death benefits in case of suicidal deaths. You should be aware of any exclusions in the plan to avoid any disappointment or misunderstandings in the future.
It is also important to know the limits of the plan to plan accordingly. When you use a term insurance calculator to find a suitable life cover, you may also find certain riders that enhance the coverage.
These riders can help you be financially prepared for various situations such as diagnosis of a critical illness, an accidental disability, etc. The term insurance calculator allows you to review the price of the plan by including relevant riders.
- Waiting Period
The waiting period of an insurance plan is the specified time span within which the insurer does not take claims. It is a period after purchasing the policy when you are not covered under the benefits of the insurance plan. Depending on the type of insurance and coverage, the waiting period may range anywhere from days to months.
The amount of suitable life cover that the term insurance calculator displays may also be impacted by the waiting period. Make sure to read the policy document carefully to know when the coverage begins.
With online term insurance calculators, you do not have to depend on insurance agents for information entirely. It has made the insurance purchase process more transparent and accessible. You can create a sound financial plan by making optimal use of an online term insurance calculator.
Furthermore, the plan can also be purchased online without much hassle. The availability of relevant information and an online term insurance calculator has simplified the process considerably.