Life Insurance Council

How to Plan

Don't buy insurance just because your neighbour bought it. Buy insurance because you need it.

Here are a few points to ponder about, whilst going about fulfilling your needs.

What kind of insurance do I need?
Understand your financial goals. Once you know what your aim is, you will be in a better position to choose the type of insurance you need - protection, savings, investment or retirement.
What will my insurance policy cover?
Different insurance policies have different covers. Make sure your financial advisor presents you with a list of recommendations, including the types of policies and benefits. Read them thoroughly to be aware of what your policy covers.

How much insurance coverage do I need?
The amount of insurance coverage you need depends on factors such as the number of dependants, debts or mortgages, lifestyle and investment needs. Insurance cover should be to such an extent that in case of one's demise, his / her dependents are able to maintain the same lifestyle as they used to have before the unfortunate event occurred.
How much will I be paying for my insurance cover and will I be able to afford the premiums over the long term?
The amount of premium paid depends on the insurance cover you buy. Look at the current benefits your insurance policy provides and opt for a rider accordingly. With some riders, you may stop paying premiums for your policy if you become disabled, but will still be able to enjoy the benefits of life insurance protection.
Frequency of Premium Payment:-
Choice of Frequency of premium payment period - Single premium, Yearly, Half yearly, quarterly and monthly should be carefully exercised. However, if your policy does not have this benefit and you are finding it difficult to continue meeting the premium payments, consult your financial advisor.
Modes of payment
- *Payment ECS
- *Credit card
- *Internet payment
- *Cash
- *Cheque
Note- While exercising the choice for frequency of premium payment and mode of payment ,please ensure that you mark the appropriate column in the proposal form.
What is Free Look Period?
IRDAI (Protection of Policyholder's Interest) Regulations 2017 provides 15 days 'free look' period from the date of receipt of policy document and period of 30 days in case of electronic policies. As a policyholder, you can examine the insurance policy and opt out if you are not satisfied with any conditions/ features mentioned in the policy.
What happens if I fail to make the required premium payments?
Typically there is a grace period (15 to 30 days) during which you can pay the premium with no interest charged.If you do not pay your premium within this grace period, your policy lapses as a matter of general rule.However the discontinuation of policy is governed by the policy conditions which may differ from insurer to insurer and plan to plan.
Should I replace an existing insurance policy?
An insurance policy is a long-term commitment and any decision to cancel a policy should only be taken after careful consideration. Early cancellation of a policy may incur additional fees and charges. More importantly, you could lose out on valuable benefits. If you are unable to continue paying premiums on your current policy, you should consult your financial advisor on the options that are available. If you decide to replace your current policy with a new one, we would recommend that you do not cancel your original policy until you receive confirmation that your new policy is in force. This will ensure that you are not left without coverage during the interim period.