|Insurance Buying Tips #1: Shop smart|
|When looking for insurance, your No. 1 priority should be to find adequate coverage. Price is important, but you’ll want to determine what kind of coverage you need first. Then you can fit that coverage into your budget and determine which carrier can provide you with the most comprehensive policy for your situation. You may be tempted to choose insurance with the lowest price tag, but if you don’t have enough coverage (or the right kind of coverage), you will see less financial benefit when it comes time to file a claim.|
|Insurance Buying Tips #2: Look for discounts|
|Once you evaluate your coverage needs, factor in your budget and find ways to save. Ask your insurance agent if there are any discounts on your coverage. Often, carriers offer discounts for things like paying your policy in full, staying auto accident-free or, if you’re in school, getting good grades. You also can save money by “bundling” multiple policies, such as purchasing a home and auto policy from the same carrier.|
|Insurance Buying Tips #3: Fill in the gaps|
|An average policy will cover the basics, but you may need to add extra coverage to meet your unique needs. For instance, you may have items like electronics or a nice piece of jewelry that would be financially difficult to replace, even with the assistance of your average renters or homeowners policy. You may want to add additional coverage for these items.|
Why Critical Illness is needed with Your Basic Term insurance?
Do you know the benefits of a term insurance plan? Besides the low premiums, which are an obvious favorite, the plan fulfils the most basic life goal – income replacement. By providing a combination of a high Sum Assured and cheapest premiums, a term insurance plan ensures financial security for the family if the insured dies pre-maturely. As such, a term plan is very popular among many of us.
Have you invested in a term insurance plan? Great! Have you included a Critical Illness Rider in your Term plan?
Riders, like the insurance plan, are also a very beneficial component. It is mostly because of our ignorance that we overlook riders when we buy a term plan. Take the instance of the Critical Illness itself. Despite being beneficial, how many of us have included it in our term plan? Not many. So, let us put our ignorance to rest and understand what a Critical Illness Rider is and how it is important.
What is a Critical Illness Rider?
Riders are additional benefits which can be added to our basic insurance plan for increased benefits. It covers specific critical illnesses. If we suffer from any of the covered critical illness, the rider pays us an additional Sum Assured in lump sum. This benefit is paid simply on diagnosis of our illness irrespective of whether we die or avail treatment for the same.
What is the importance of including the Critical Illness Rider with our Term Insurance Plan?
|Insurance Buying Tips #4: Purchase life insurance—you aren’t too young|
|Life insurance is essential, no matter how young or old you are. And for millennials, buying now may be a smart move because it’s cheaper to buy a life insurance policy when you’re young and healthy. This kind of insurance can help your family cover unexpected costs in your absence, including student loan debt or a mortgage, in addition to end-of-life costs. And if you have kids, a life insurance policy can also support their education or childcare expenses. Additionally, every millennial should consider long-term disability coverage, which helps you stay afloat financially if an accident happens and you become disabled and unable to work.|
|Insurance Buying Tips #5: Talk to an independent agent|
|An independent insurance agent is an essential resource when purchasing insurance—especially if this is your first time. An independent agent works with multiple different carriers, which is different from captive agents who can only sell insurance from the carrier they work for. Working with an independent agent can help make sure that you are getting the best coverage, for the best price. You’ll also benefit from independent agents’ insurance knowledge; they know how to talk you through your options and actually explain what each policy includes. An independent agent will make sure all of your assets are covered, help you find discounts or other ways to save, and be a valuable resource as your life changes and your insurance needs change, too.|
|Insurance Buying Tips #6: Only buy insurance to maintain your existing standard of living|
|You don’t need insurance for events that won’t severely strain your finances. Start with your basic needs (home, auto, business), then work your way to include other needs (cyber, liability). You can always obtain coverage later for something if you change your mind. You can minimize your risk and maximize your savings by buying insurance that won’t cause you to break the bank.|
- Critical Illnesses are common and financially difficult
Do you know why Critical Illnesses are called so? These illnesses are severe, fatal and chronic. They involve complicated medical treatments and procedures. Do you know the cost of such procedures? Let's just say that the costs are magnanimous. Juxtaposed to this, critical illnesses are also becoming very common nowadays. Whether you talk about cancer, stroke, heart attacks or organ failures, critical illnesses are on the rise. This deadly combination of increasing illnesses and high medical costs is a curse for us, both physiologically and financially. Critical Illness Riders, by providing financial support, help in taking care of the financial aspect of the illness which would otherwise be difficult for us.
- The rider increases the scope of cover
Our term insurance plan pays the benefit only in case of pre-mature death. What happens if we are merely diagnosed with an illness which might not cause death? Would the term plan pay? No, it won't. But, a critical illness, though not fatal, does require considerable funds for its treatment. A Illness Rider comes into the picture here. Since the rider pays the benefit on mere diagnosis of the ailment, it provides us with the required funds for the treatment of the illness. As such, the rider increases the scope of coverage.
- The rider helps in replacing your income
When we suffer from a critical illness, we are forced to take a break from work. As such, our income stops. The benefit paid by the rider can be used to replace this income and meet the day-to-day living expenses of us and our family.
- The rider saves additional tax
The premiums you pay for your term plan is exempt from taxation under Section 80C. If you also include a Critical Illness Rider, you get an additional tax exemptionunder Section 80D. Thus, the rider helps you in claiming additional tax exemption.
A critical illness rider, thus, has various benefits. These benefits can be yours if you include the rider in your term plan. If you are worried about the additional premium outgo, relax! Rider premiums are minimal. By paying a fraction of your term insurance premium, you can add the rider to your basic plan. Do the math yourself. Do a term insurance comparison, or a Term insurance with return of premium comparison both with and without the rider and you would understand the cost-benefit aspect of the Illness rider. With so many benefits promised by the rider at the lowest possible cost, isn't it prudent to add it to your term plan?
|Insurance Buying Tips #7: Ask your insurance provider what the policy doesn’t cover|
|Every insurance policy has perils that are not covered by your policy. These perils are referred to as “exclusions”, and every policy has them. Ask your insurance provider to explain the exclusions in your policy to avoid discovering what they are once you incur damages or a loss.|
|Insurance Buying Tips #8: Consider bundling several policies with one insurance carrier|
|here may be value in bundling several policies with one insurance carrier. If you’re looking to insure multiple vehicles or obtain multiple types of business coverage (e.g., liability, property, cyber), then you may want to consider obtaining coverages under one insurance provider who carries multiple products, and who may be able to offer you multi-policy discounts or loyalty programs.|
|Insurance Buying Tips #9: Review your insurance needs on a yearly basis|
|As your needs evolve, so will your insurance policy. Maybe you’ve acquired a new vehicle since obtaining auto insurance for your primary vehicle, or started operating your business out of your home, or experienced a cyber-attack during the year… Whatever the change(s), you’ll want to make sure you’re covered for any new risk exposures. Talk to your insurance provider to stay on top of your insurance needs.|