How to pick the best life Insurance Policy in 2023 in India: Do you have any need to buy life insurance, if needed, which life insurance will be right for you and how much coverage will be right for you, today this article has all the questions related to life insurance in your mind. I will try to answer them one by one and at the end of this article, I will also tell you which life insurance I have taken myself and why out of so many thousands of policies, I have chosen that policy for the best value, so let’s start.
Do you have any need to buy life insurance?
So first of all, let’s talk about if you have any need to buy life insurance. To find out you have to ask yourself a question. Do you have a dependent on you? Meaning if you do not live in this world then it will be difficult for those people to keep their stomachs running. Do you have a dependent like your son or daughter or your wife or your parents? If your answer is no, then there is no need to buy life insurance, but if your answer is yes then you must definitely buy life insurance. Because as the disease and accident rate continues to increase day by day, in such a situation anyone can die. So even if you are no more, the dependents are still on you, It is a very important responsibility to ensure that they do not have any problem on behalf of at least money.
For how many years should you purchase life insurance coverage?
If you die before 60 years, then your family will get money or before 70 years or for your whole life, whenever you die, your family will get money, you should buy such an insurance policy. So to find out this also, you have to ask yourself the same question again, but turn around a bit. To what age you will be dependent on yourself? So let’s say you are 30 years old and dependent on you, that means only your son who has just been born and your wife works for herself, so she is not dependent on you, so when your age is 60 years, then your son’s age will be 30 years and by then your son will also start making income. Meaning then your son will not be dependent on you. So in such a situation, you should keep the coverage up to 60 years. That means if you die due to some reason before 60 years of age, then your family will get the insurance money.
How much life insurance coverage should you buy?
Now the question comes, how much coverage is right for you, in such a situation, which is considered a Thumb rule, you should take life insurance coverage up to 20 times your annual income. This means, that if you have an annual income of Rs 5 lakh, then you should definitely take a life insurance cover of 1 crore.
At What Age You Should Buy Life Insurance?
When you come to which age you should buy life insurance, the sooner you buy, the more your benefit is. The reason for this is that suppose you have an age today of 25 years and today you are buying life insurance and now your age is very low, so the chances of your death are less within the next 10 years, that is why the premium of insurance which you have to pay the insurance company every month or every year, that too will be reduced considerably and this premium insurance is fixed only when you buy. Meaning that at the age of 25 today, if you pay only 30 rupees per day premium and keep the life insurance coverage of 1 crore rupees till the age of 60, then for the next 35 years, you have to pay only 30 rupees to the insurance company every day. It will be fixed forever, due to which, after 20 or 25 years from today, you will not have any problem paying the premium of Rs 30 days. But if you come to the age of 40 and go to get the same amount of life coverage, then the chances of your death within the next 10 years are very high, so you have to pay a lot of premiums and that is exactly why I am still There are no dependents but still coming up on me in a few years, so I have just kept buying life insurance so that I have to pay a lower premium. How to pick the best Life Insurance Policy
Which Life Insurance You Should Buy?
See there are many types of life insurance such as: –
1. Term Plan
The example of which I was telling you till now, such as: – If you die in the middle of this 40-year term i.e. from the age of 25 to 65 years, then you will keep the amount of coverage that you have, The money will be paid by the insurance company to your family. But if you die after 65 years, you mean 66 or 70 years of age, then your family will not get any money.
2. Whole Life Plan
This means, that whenever you die, even if it is in 100 years, your family will pay as much amount of coverage as the insurance company will take. But in such a situation, the premium is very high.
3. Ulip Plan
In this, your money will be invested in the stock market and you will also get life coverage.
4. Endowment Plan
Suppose this, if you keep the coverage for 65 years but you continue to live even after 65 years, then the insurance company will get the full amount of money including the amount you pay back as a premium total.
So from these 4 different plans, I personally prefer the Term Plan. Now perhaps this question may come to your mind, but if I survive even after that particular age, then my family will not get any money back. Whereas if I remain alive after the endowment plan, even then I will get all my money back with interest. Then the term plan was a much better option. The reason behind this is that by paying a very low premium in the Term Plan, you will get a large amount of life coverage. If you go for coverage of 1 crore for the same endowment plan, then its premium will be much higher, which may not be possible for you to be able to afford. And the main objective of the insurance is not to make the user secure but to invest. The interesting thing is that if you go to buy life insurance from a bank or an insurance agent, then all of them will ask you to take an endowment plan because it is your advantage, not at all because that agent has the most benefit in it, so see more Those people will tell you that your money will double in 12 or 14 years. They will never tell you how much annual interest rate you are getting because if you double your money in 12 or 14 years, then if you look at the calculation, then you get an annual interest rate of only 5 to 6 percent.
Therefore, it is better if you take a term plan, then you will also get a large amount of life coverage by paying a very low premium, and by not taking an endowment plan, you will be able to secure the premium money, FD, Mutual according to your own Funds, Gold, Real Estate, Stocks can invest anywhere and with this, you can easily earn much higher returns from 5 to 6%. For this, if you want to take life insurance, then the term plan is right. How to pick the best Life Insurance Policy
From Which Company You Should Buy Life Insurance?
According to the 2018-19 Annual Report published by IRDAI, all insurance represents the company’s Comparison. There are four things you must take care of before taking life insurance from any company.
1. Total No Of Policies Issued
That is how many policies are issued by that company. The higher it is, the better.
2. Benefit Amount
Meaning how much money the company has returned to the people who have claimed insurance. It’s also the best you can get.
3. Claim Settelment Ratio
That means how many percent of the total claims that have come to that company have been made by that company and they have given money to their family. It can be considered good only if it is at least above 95%.
4. Amount Settelment Ratio
That is, how much of the total amount of the claim has come, and how much of that amount has been approved by that company. If there is more than a 5% difference between the claim settlement ratio and the amount settlement ratio, then it is better to avoid that company.
So if you look at all these factors, by comparison, you can see clearly that no company has been able to reach around the LIC. Therefore, if I want to take life insurance from you personally, I will adjust to taking it from LIC itself, and if I tell you specifically, I will adjust to taking the Tech Term Plan (854) of LIC. The reason behind this is that this plane is available online only. Therefore, due to the case of the agent’s commission being absolutely zero, you will get a large amount of life coverage by paying a lower premium annually. How to pick the best Life Insurance Policy
I hope that I have been able to answer all the questions in the article on ModMax.net that you had in your mind related to life insurance, yet if you have any questions in your mind and want to ask something about it, then tell us by commenting below.
Thank you for reading this article.