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Life insurance Criteria For Being Approved Quickly

Most of us plan to make our future better than what it is currently. While some believe in planning things in excruciating detail by having long-term plans, others believe in accomplishing short team goals. 

Irrespective of which school of thought you believe in, ensuring that your loved ones are well taken care of is a commonality. This is precisely the reason why one must opt for a life insurance plan. 

A life insurance plan will safeguard the future of your family and ensure that they continue to live without any financial constraints even in your absence. Given the wide range of products available with insurance companies, you can choose a product that best suits your needs.

Buying a life insurance plan brings a plethora of benefits along. The following are some of the most prominent ones. 

  1. Financial Security

Once you buy a good life insurance plan, you need not worry about the finances of your loved ones. In the unfortunate event of the death of the insured, the insurance company will pay the sum assured to the nominees of the policy. Your family can use the amount to pay off any debts, education of children, take care of loans, etc.

  1. Tax Benefits

Most life insurance plans have dual benefits should you decide to buy one. To start with, if you buy a life insurance plan, the policy premiums offer deductions under Section 80C up to a maximum of INR 1.5 lakhs a year.

Also, in the event of a payout, the entire amount might be tax-free under Section 10D(D) of the Income Tax Act as long as the premium is less than 10% of the sum assured.

  1. Create Wealth

A life insurance plan also acts as an excellent instrument to build wealth over a period. Depending on your risk appetite and the plan that you opt for, the insurance company would invest in various instruments to help you build wealth.

  1. Bigger Savings by Buying Early

When it comes to life insurance plans, buying early is one of the easiest ways of optimizing things. During your younger days, the risks associated with your life are less and thereby you would warrant a lower policy premium. The same policy will cost you a lot more if you buy it later in your life.

Criteria for Life Insurance

Once you decide to buy life insurance, being aware of the life insurance criteria will ensure a quicker turnaround time. However, the eligibility criteria for insurance largely depend on the type of policy that you choose to buy. Here are the different insurance policy types and their eligibility criteria. 

1. Term Life Insurance
The following are the general criteria for a term life insurance plan. Depending on the insurance company that you opt for, the criteria may differ a bit.

  • The policyholder should be an Indian Citizen to buy a term life plan. PIOs and NRIs can also buy the plan
  • The insurer usually must undergo a medical test before buying the policy. This minimizes any risks or helps in the identification of medical conditions
  • The policyholder must provide the required set of documents
  • Smokers will most likely end up paying a slightly higher premium than non-smokers, due to the significant health risks.

2. Unit Linked Insurance Policy

If you wish to buy a ULIP or Unit Linked Insurance Policy, here are some common eligibility criteria that you must meet:

  • Depending on the insurance company you must meet an entry and exit age limit
  • The policyholder must provide the required set of documents
  • You must adhere to the policy of paying premium term and payment mode.

3. Endowment Plan
To buy an endowment plan for an insurance company, you must meet the following basic criteria. Your insurer might have some additional criteria.

  • You must comply with the minimum and maximum age limits to buy the plan
  • The policy also has a minimum and maximum maturity age
  • The policyholder must provide the required set of documents.

4. Whole Life Insurance Plan
The eligibility criteria for life insurance type whole life are as follows:

  • You must comply with the minimum and maximum age limits to buy the plan
  • The policy also has a minimum and maximum maturity age, the maximum age is 100 years.
  • The policyholder must provide the required set of documents

5. Retirement and Pension Plans
To be able to buy a retirement and pension plan, you must meet the following eligibility criteria:

  • You must meet the minimum and maximum entry age for the policy
  • You must meet the minimum and maximum vesting age for the policy
  • The policy usually ranges between 10 to 30 years
  • You must submit the required set of documents for the policy

Documents Required

As is the case with the eligibility criteria, the following are some of the standard documents that insurance companies usually look for. Based on the policy type that you want to purchase you might have to provide additional documents. 

1. Identity Proof

You can provide any of the following documents.

  • Passport
  • Aadhar Card
  • Driving License
  • PAN card
  • Voter ID

2. Address Proof

The following qualify as address proof.

  • Passport
  • Aadhar card
  • Driving License
  • Electricity Bill
  • Telephone Bill

3. Age Proof

For proof of age, you can submit any of the following.

  • Passport
  • Birth Certificate
  • Driving license
  • Voter ID 

Though it might seem a bit overwhelming to buy life insurance, if you have enough information it is relatively easier. Irrespective of which of the above life insurance policy you opt for, being aware of the eligibility criteria will enable you to apply and quickly get the policy processed.

Once you are aware of the different eligibility criteria, you can verify for yourself whether you qualify for the policy or not. In the event that you do, you can get started with the documents required by the insurance company. All this will ensure that your policy is approved quickly.

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