Life insurance coverage is one of the most critical parts of your financial planning. Insurance has also been considered one of the primary investment tools in India.
There are quite a few variants when it comes to life insurance, in the market. Term plans are among the simplest ones and are accessible for providing high coverage at a very reasonable cost. The low premium amount makes them the cheapest way you can opt for high coverage.
You can choose between offline term plan or an online one. The first is offline because it involves an insurance agent.Many people go through the confusion about which of the two plans they should choose. We shall try and compare these two types of term plans to help you decide which one suits you the best as per your requirements.
While protection is a key factor and one should opt for high coverage while choosing a term plan to secure your family’s future, there are some other important factors you need to keep in mind. Let’s weigh the pros and cons of online and offline term plans:
1. The cost factors
Cost is undoubtedly a significant factor when it comes to choosing a suitable plan for you, but you need to look at the fine print. The term policies available online are 30-50 percent cheaper than the ones available offline because there’s a high agent commission built in with offline policies. Hence, all insurance policies, including term plans, are cheaper when bought online.
2. Disclosure of facts
Your agent does all the work for you in case of offline policies and updates you about the developments. With an online term plan, the responsibility of disclosure of all facts lies with you as no agent is acting as an intermediate. Therefore, it is you who needs to do all the reading and understanding of what your insurance policy offers you. You must remember that misrepresentation or non-disclosure of facts, knowingly or otherwise, may lead to rejection of insurance claim or even nullification of the policy in the future.
3. Flexibility
An online term plan has an edge when it comes to flexibility,and you can buy it from the comfort of your hoit without approaching anyone or making several visits. Get this with the click of a button. Additionally, you can see all the Terms and Conditions before making the payment, and get your medical tests done in the comfort of your home. However, specific tests happen only at medical centres.
You get the policy bond to your doorstep and pay the renewal premium online at your chosen intervals, for the years to follow. You can look for an online term plan and choose what suits your needs.
4. Customer Support
With the terminology used in the documentation, you are bound to have doubts while filling the form online. Most insurance companies have helplines dedicated to helping you out with such difficulties. You can call the customer care and inquire about all the doubts you may have about your online term plan. Even when it comes to claiming settlement, you can talk to customer care and get the work done.
Insurance agents often use this argument to dissuade people from buying term plans online. They assure you that they will do all the running around when it comes to claiming, but most financial experts note that there is no running around required in the first place to initiate the claim settlement process and that these are just ploys to make online term plans look cumbersome.
5. Claim Settlement
According to The Insurance Regulatory and Development Authority (IRDA), there are some guidelines when it comes to claim settlement. For claims raised within the first two years, insurers must investigate and settle the claim within six months while in the case of policies older than two years, the timeframe that they get is 90 days, during which the settlement must take place.
So, it does not matter whether your policy is offline or online, the claim settlement follows the same procedure. If your claim gets rejected even after proper disclosure of all the necessary information, you have the provision to approach an insurance ombudsman to gain justice.
You can look for available offline and online term plans and compare them to decide which one suits your needs the best. The choice is entirely yours!
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