Important factors to be considered while deciding term insurance coverage
Life is unpredictable, and no matter how prepared you are, you have to face the worst situations. The example of the COVID-19 pandemic shows the significance of being prepared in case of health-related crises. And looking at the growing demand for health insurance policies, insurance providers are now focussing on further improving access and acknowledgment of the COVID-19 vaccine. As a result, many are offering COVID health care coverage under their policies.
Amidst the present circumstance, individuals actually have questions with respect to term life insurance policies and their inclusion. By buying a life insurance policy, especially a term insurance plan, one can guarantee financial security for their loved ones in case of their absence. In addition, term insurance offers coverage for a significant number of critical illnesses in case you roll out the right changes to your term insurance plan. As our ways of life change and wellbeing concerns outweigh everything else, such inclusions can be an enormous advantage for people and families across the country.
Moreover, a term insurance policy is based on an individual’s yearly income. One ought to select a cover that is somewhere 10 times their yearly compensation. With the vulnerabilities expanding, certain individuals additionally recommend making it 20 times. One ought to consistently be perceptive of their prerequisite and select the plans astutely. Also, people intrigued by term insurance should note that the IRDAI has recently issued new rules for health insurance providers with impact from October 1. The progressions are expected to make health care coverage more comprehensive, simpler while covering more treatments.
5 Important Factors to be considered while deciding term insurance coverage
Now let’s indulge in the important pointers that individuals should remember before purchasing a term insurance plan.
- Customer-Centered Solutions: Insurance providers used to take a one-size-fits-all methodology, yet no more. The clients are more mindful than before, and they expect customized solutions to their particular requirements. To meet client expectations, insurance companies are offering flexible and personalized policies as per customers’ needs. This is also one of the major term insurance trends to observe in the near future. Insurance companies are also focussing on providing improved claim settlement mechanisms. Policyholders can now upload documents and file claims easily. Insurance providers can utilize this to work on their productivity and settle claims rapidly and effectively.
- Cashless Claim Settlement: Cashless claim settlement is when the insurance company settles the bill directly with the hospital. The insured does not have to pay anything from his or her pocket. One is only required to pay in case of sub-limit clauses or co-payments which have been decided at the time of policy purchase. Additionally, with the Reimbursement Claim Settlement Method, individuals have the choice to pay for the treatment at the hospital of their choice and get the expenses reimbursed up to the sum insured from the insurance provider subject to the submission of all original bills, reports and discharge summary.
- Increased Benefits and Options: As the demand for insurance policies and the number of potential policy buyers are increasing day by day, so is the competition among the insurance providers. Accordingly, insurers launch different types of insurance policies and riders and other unique benefits to meet different requirements of the policy buyers. And by offering extra benefits, insurance companies will attempt to beat the competition.
- Waiting Period for Coronavirus: Taking the case of a sudden attack of Coronavirus, the insurers have focussed on the waiting period. The awareness related to health insurance has increased with the expanding cases from the first to second influx of COVID-19. Thus, many individuals purchase health insurance plans and COVID-19 specific plans to avail of comprehensive benefits like treatment and hospitalization expenses. Thus, the insurance providers are required to complete the waiting period for as long as 30 days. The Corona Kavach Policy is accessible with a policy tenure of three and half months, six and half months, and nine and a half months, including a waiting period. Normally, a waiting period of 15 days is applicable under these policies.
- No Claim Bonus during COVID-19: Cumulative Bonus or no claim bonus in health insurance is the bonus sum insured that is added in the policy sum insured for every claim-free year. It is kind of a reward that the policyholder receives for not using his medical coverage. This eventually results in an increased sum insured amount every year.
Moreover, insurance companies are required to settle or reject a case within 30 days of its receipt. In the event that an insurance provider fails to settle a case within this time period, it should pay interest at a pace of 2% over the relevant bank rate on the sum owed to the policyholder. This implies that in case the claim is denied, the insurer will be needed to pay an extra amount in addition to the claim amount.
Therefore, pay heed to the above-mentioned pointers while opting for the ideal term insurance cover while buying a term policy. To gather more information on the same, you can visit iiflinsurance.com