How to Choose the Best Insurance With These Must-know Facts

Insurance is an inevitable part of our lives but choosing a policy can often get tricky, especially since the market is flooded with so many options. Not only do we have an array of insurance providers but also a vast number of tailor-made insurance products or package deals, which makes it even more harder for the average consumer. On the other hand, most people do not ascertain their insurance needs and simply go for the most marketed policy. This, in the long run, will not benefit policy buyers because an insurance portfolio, which may consist of health, life, car insurance, etc, should be built based on various personal factors such as age, income, needs and lifestyle. Rarely do buyers plan their insurance portfolio and because of this, customers lose out many benefits. In this article, we will tell you how to choose the best insurance plan:

● Evaluate your needs: The first step towards buying the right insurance policy is to ascertain your needs, list out the requirements of both you and your family members and chalk out how much money you will be able to invest in an insurance policy. For example, a life insurance cover should be a top priority and it will be better to choose a family policy if you have dependents. So, know your needs and choose accordingly.

● Look at the perks offered: Be aware of the perks and benefits offered by the insurance provider and see if it holds any actual value. For example, despite the fact that unit-linked plans offer lucrative stock earning options, they are more expensive than regular term plans and do not give adequate coverage. Experts warn buyers not to choose such plans unless the policyholder already has a term insurance plan that provides adequate coverage. On the other hand, there are some benefits that are worth it, like the premium back plan. Here, the entire premium is paid back after the end of a policy period.

● Get multiple quotes and make comparisons: The rule of thumb is not to go for the first policy that is offered to you. Do your research, get multiple quotes, ask about all the benefits, coverage and add-on options, etc. Once you gather all details from a set of insurance providers, do a thorough comparison to decide what is best for you. It is important to take this step because the same individual with the same car can get different insurance quotes from different insurance providers. Specifically for car insurance, you can get the best deal by comparing policies. This comparison can be done online easily.

● Avoid agents: At no point of time should you be coaxed into buying something you are not sure of. So, avoid insurance agents because they usually represent only a particular insurance company. Do not fall into a trap laid out by an insurance agent because you do not want to end with a policy that you do not actually need. Many of these agents try to convince the buyer to go for a higher sum insured or cover, when the client does not actually need that much. This will only burn a hole in the pocket of the policyholder.

● Have the right coverage: Remember, you should neither be under-covered nor over-covered. The trick is to evaluate what amount of coverage you really need so that you will not end up paying a higher premium, which will only benefit the insurance relationship manager and not the client.

● Ask the right questions: Don't be afraid to ask your insurance provider the right questions. Clarify all your doubts before you purchase the policy so that you are not left in the lurch. If you're buying a car insurance policy for instance, it is very easy to just go for a policy that your friends are opting for. This, may not be a great idea. For example, ask the company if they provide personal injury protection. This is important because it pays for medical expenses if another person hits your car.

10 must-know facts about insurance

1. Buy life insurance as early as possible because the older you are, the higher the premium

2. A tax benefit can be availed for premiums paid on life insurance under Section 80C of the Income Tax Act

3. Savings-linked policies are ideal for those who already have sufficient coverage from another insurance policy

4. If you have a car insurance policy, remember that the policy does not cover damages due to a fire, hailstorm, earthquake, vandalism or animal accident

5. Your credit score or credit rating is one of the factors that determine the cost of your insurance policy

6. A personal car insurance policy does not cover any losses incurred if the car is used for business purposes such as transporting clients, etc

7. When you buy a health insurance plan, always remember that coverage for certain specified conditions like knee replacement, cataract, kidney replacement, etc, come with a waiting period

8. Certain health conditions will not be a part of the health insurance policy. Be aware of the health coverages in your policy to avoid confusions during a medical emergency

9. Life insurance is not an investment but a risk management tool

10. Remember, your employer also provides health insurance for you and your family

To sum it up, the insurance policy landscape is difficult to navigate. However, if you do your research, compare plans and choose one that best suits your needs, there is nothing to worry about.

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