Guidelines to Choose Best Life Cover in Covid Days

A life insurance policy comes with two options in terms of the payout of a death benefit to the policyholder’s nominee — lump sum and monthly payout. In the case of the lump sum payment, the dependents of the deceased would receive the entire sum assured as a one-time payment if the policyholder dies within the policy term. They can then decide how to use that money. On the other hand, you can also choose the staggered payout option, under which your nominee receives the sum assured in monthly instalments, which can run for 15-20 years, thereby ensuring regular income for your family. You can choose the monthly payout option if your family is not financially well informed and if you feel they may not be able to manage a large sum paid as a lump sum payment. Instead of monthly payments, you can also choose any other periodicity of staggered payments as you may deem fit as per the requirements of your family. There is also an option to choose a mix of both alternatives wherein a part of the sum assured is paid immediately at the death of the policyholder and the remaining amount is paid in periodic instalments.

Choose the right insurer

Say one does all their homework and buys a sound life insurance policy, but when their nominees make the claim, they have to run from pillar to post to get the money that is due to them. Or worse, their claim is rejected unfairly. This is why you must buy the policy from a reliable insurer. You should not only look at the premium the insurer is offering you, but also the claim settlement record of the insurance provider. This would give you a fair idea if your family would get the sum assured without any trouble.

Choose add-ons as per your needs

When you buy a life insurance policy, you can also choose some extra benefits on top of the base policy, which are called “riders” or “add-ons”. You can choose from add-ons for critical illnesses, accidental death or disability, waiver of premium, and so on. A critical illness rider pays out a lump sum amount if the policyholder is diagnosed with any of the listed critical illnesses, while an accidental death or disability rider does the same if the policyholder loses his or her life, or is left totally or partially disabled, due to an accident. In case of a waiver of premium rider, all future premium payments are waived if the policyholder can no longer make them due to certain events like critical illness or permanent total disability due to an accident. Meanwhile, the policy continues uninterrupted until the end of the policy term.

Buying Insurance Online

When you buy your life insurance policy online, you get the option to compare plans offered by different insurers right from the comfort of your home. This can help you zero in on the right plan for yourself while also ensuring you get the best deal.

There is no doubt that the Coronavirus pandemic has served as a wake-up call for those who either have not considered taking a life insurance plan or have been postponing it. Although Covid-19 is a newly discovered ailment, the good news is that it is covered by most life insurance policies. In this uncertain world, it is crucial to buy a life insurance policy and include it in your investment portfolio. Make sure to read the policy document to understand the extent of coverage against the Covid-19 virus.

The author is Head-Term Life Insurance, Policybazaar.com