With every passing year, your youth decreases but the one thing that continually increases is your responsibilities. The one step to financially secure the future of your family and dependents in your absence is with insurance. No matter how harsh as this may sound, death is a reality no one can escape and hence, it is wiser to plan well in advance so that your family’s future can be safeguarded. The best way to provide them with security is by buying a term plan.

A term plan is an affordable form of insurance where an assured sum of money will be paid to your family in the event of your demise. The cover is available for a fixed period and upon payment of nominal premiums. It is a simple and guaranteed tangible security, which you can effectively rely on.

But with so many insurance plans in the market today, how do you know which one to invest in? Here are some easy tips that will guide you on how to buy the right term insurance.

1. Choose one insurer and buy online: All insurance companies are governed by the Insurance Regulatory Authority of India (IRDA) and adhere to its norms. This defeats the logic of taking multiple term insurancesfrom different companies since the rules are the same for all. Hence, it is best to buy a term planfrom a single IRDA registered company, so that your family does not have to run from one insurer to another for the claim. Also, make your purchase online, since that offers an unbiased analysis of prices, features, and excludes middlemen, which possibly raise the cost of theinsurance plan.
2. Determine the right plan cover: The most important thing while buying a term planis to set your priorities right. You should know your need and what kind of coverage will be required to meet the needs of the family in your absence. Make a choice by considering factors such as family size, age, health, personal income, and current liabilities. In general, you should pick a cover with premiums that are easily payable from your current income and one that is sufficient to secure your family’s future.
3. Add riders to maximise plan coverage: Term insurance in Indiacomes with simple plans that do not cover accidental demise, critical illness, permanent disability, etc. Hence, it is best to add these riders upon payment of a nominal fee to widen your plan coverage.
4. Assessthe term of the plan: Do not take a cover that stretches too long or a cover that matures too early. You should choose the policy tenurebased on the age you wish to retire.This also makes payment of premiums easier. On the other hand, you should not keep the maturity of the term insurancesuch that it matures when you are far from retirement or old age. This could be the time when your needs are at their prime,and your health begins to deteriorate. A new term plan at such a stage will be too expensive to buy. Moreover, the term shouldn’t be too long. A good term varies per case, but averagely should be up to 60-65 years of the insured’s age.
5. Account for inflation: When buying term insurance in Indiaalways choose one which provides you with a hike on the insured sum yearly. This will help you to offset the impact of inflation over the years and meet future demands adequately.
6. Check the claim settlement ratio: When investing in a plan,it is most important that you assess the claim payout ratio of the insuring company. This ratio indicates the number of claims paid back by the company. While all insurers are governed by IRDA, which implies that they are dependable with a good claimsettlement ratio, but it is still a good measure to check the ratio before buying the term insurance plan. Also, it is very important to disclose all true and relevant details.Any discrepancy could lead to a claim rejection in the future.

Conclusion

Overall, a term plan isvery safe and useful and provides extensive coverage at reasonable premiums and conditions. However, buying insurance is a critical decision, which will affect your family’s future, so be careful and make a wise investment.