Everyone is always telling you to buy an insurance policy, or how it is very important to buy a life insurance policy, or why you shouldn’t wait too long to get a life insurance. Right?

Even the television is bombarded with various advertisements regarding what is the best life insurance policy plan, how easy it is to get etc. etc.

However, this is easier said than done as many people do not even understand what life insurance policy truly is, the different kinds of life insurances you can get and even more on how to buy them online (yes, you can now buy life insurance policy online).

term insurance

So let us clear up these confusions a bit and answer these doubts one at a time:

What Is Life Insurance Policy?

A life insurance policy in very simple words is putting a price to your life, insuring that only so in case of an untimely or timely death, the policy holder’s beneficiary can lay claim to the sum of money that has been accumulated over the years.

The beneficiary is the person that the policy money will eventually go to, it can be the spouse, children, an organization or anyone they nominate. The money can either be given in one go in its entirety or be divided over a period of time.

The policy is a legal contract between the policy-holder (the person buying the policy and paying the premium) and the insurer (usually the bank or the company/organization that will be keeping the policy). The policy-holder, usually pays a certain amount of premium either over the course of time or at once, by a decided date in order to keep the policy active.

Not paying the premium on time or delaying it for too long can cause a lapse in the policy which might get all the previously paid premiums forfeited.

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There are a lot of details that you must be aware of before buying a life insurance policy, taking into consideration what all exceptions that policy has and what are the benefits you are getting from it.

Types Of Life Insurance Policies

  1. Whole Life Insurance:

Probably the most expensive life insurance policy, because it essentially insurances your entire life.

This is a kind of permanent life insurance policy and along with that it also offers cash value accumulation which is a value that grows each year. This kind of policy is good for retirement planning and such.

  1. Term Life Insurance:

While the above kind is for the entire lifetime of a person, term life is pretty self-explanatory. It will only last for a specific amount of time.

A term insurance plan can last anywhere from 5 years to 30 years and after your decided time period is over, you can renew it on an annual basis or withdraw the maturity amount.

This kind of insurance policy is good for saving up for big expenses like marriage and higher education of kids. Works great as an investment too, apart from providing life cover for a particular term period.

  1. Universal Life Insurance:

Although similar to whole life insurance in the fact that it lasts your entire life, the only difference being that there is a certain amount of flexibility in the death benefits. With this policy, you can decrease or increase the death benefits, of course, which will also affect the premium you are paying.

How To Buy Life Insurance Policy Online?

I have a friend who at 26 is already invested in 3 life insurance policies and her parents started one for her when she was around 10. For those beyond the line of 40 years, yes I agree, life insurance should be almost mandatory (to cover life risks, any unseen incidents, security to family, even great investment) but those on this side might not know that these instruments sometimes are the best form of investments with great returns.

Nowadays there are various online platforms which can help you select the right plan based on your budget, need, purpose etc. down till the last detail of recurrent premium payments with features like term insurance premium calculators.

Here are a few simple steps with which you can buy a life insurance policy online:

1. First compare at least 2-3 different insurers, their policies, their benefits and the process of buying it online.

2. Once you are done with selecting the insurer, you will have to probably fill a couple of forms about yourself. Sometimes they can even include certain medical records and such.

3. After that, you will have to select the kind of life insurance policy you want to buy, amount of that policy and the time period of the policy.

4. Select your class, that is whether you come under high, medium or low risk, based on this your application will be accepted.

5. Afterward, you will have to verify this application by different methods as per your selected insurer. Sometimes it just a phone call to verify the information you have given and make sure everything is accurate or not.

6. In a few weeks, you will be getting confirmation from your insurer of whether your policy has been processed and be given a soft and hard copy in a short amount of time.

Hope this piece helped you get some clarity on the life insurance space. Do let us know if we missed on some important bit of information that should have been included.

Image Credits: Google Images

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