Buying a term life insurance plan is one of the smartest ways to protect your family. It gives your loved ones money if something happens to you, and it keeps their life stable even in tough times. But before you buy term life insurance, you must know what to check. Many people buy a policy in a hurry and later realise they missed something important.
So, to help you make the right choice, here are 10 simple things you should always check before buying a term life insurance plan. This guide uses easy English so anyone, young, old, a student, or a working professional, can understand it.
Table of Contents
Check How Much Cover You Really Need
Do not pick a random number. Think carefully. Your term plan should give your family enough money to live a peaceful life if you are not around.
You can follow a simple rule:
Life cover = 15 to 20 times your yearly income
For instance:
- If you earn ₹8 lakh per year, your cover should be around ₹1.2 crore to ₹1.6 crore.
Also consider:
- Your Home Loan or other loans
- Your child’s education
- Your daily living expenses
- Your long-term family plans
These things help you in choosing an appropriate life insurance plan amount.
Check the Claim Settlement Ratio
The claim settlement ratio tells you how many claims the company has paid out of all claims received. If the number is high, it means the company pays claims smoothly. Look for insurers with a claim settlement ratio above 95%.
This gives you confidence that your family will not face problems in getting the money during a hard time.
Check the policy term-how long the plan will run
Many people forget this part. Your term plan should protect you until the time your family may depend on your income.
For instance,
- If you are in your 20s, choose a long term like 40 or 45 years.
- If you are in your 30s, choose a term till age 60 or 65.
- If you are in your 40s, choose a term till retirement age.
The longer the term, the longer the protection for your loved ones.
Check Premium Amount and Your Budget
You want full protection, but the premium must also be easy to pay every year. A term plan should never feel like a burden.
Check:
- Annual premium
- Monthly premium if you pay monthly
- Whether the premium stays constant for the full term
- Whether there are additional charges for riders
Make sure the premium fits your long-term budget. Remember, you may need to pay this for 30–40 years.
Check the Add-Ons (Riders) Offered
Riders are extra benefits you can add to your life insurance plan. These make your policy stronger. Some useful riders are:
- Critical illness rider: Pays out money if you get a bad illness such as cancer or heart disease.
- Accidental death benefit rider: Provides additional money in case of death due to an accident.
- Waiver of premium rider: You don’t have to pay premiums if you become disabled or seriously sick.
- Income benefit rider: Gives your family monthly income in addition to the lump-sum amount.
These riders cost a small extra amount but provide big help during emergencies.
Check the Claims Process
The whole purpose of buying a term plan is that your family can get money easily. So before you buy term life insurance, check how simple the claim process is.
Look for:
- A simple online claim process
- A rapid documentation technique
- A 24/7 helpline
- Dedicated claim support teams
If the claim process is smooth, your family will get the money faster and without stress.
Check whether the plan offers conversion or flexibility
Features of some term plans are:
- Conversion of a term plan into a whole life End
- Increasing life cover at major life stages
- Decreasing cover when your responsibilities reduce
These features can help you handle changes in your life. For example, if you get married or have children, you may want more coverage. A flexible life insurance plan lets you do that without buying a new policy.
Check the Exclusions What the Policy Does Not Pay For
Every insurance policy has exclusions, which are cases where the company will not pay the claim.
Common exclusions include:
- Death caused through criminal activities
- Death due to hazardous hobbies-unless declared
- Death due to suicide within the first year varies by insurer
- Medical conditions not disclosed during buying
Read the exclusions carefully. If you hide any medical information, it may cause problems later during claim settlement.
Check the Premium Payment Options
Different insurance providers extend varying pay options, including:
- Annual
- Half-yearly
- Quarterly
- Monthly
Some plans also offer:
- Limited pay – pay for 10 or 15 years but get cover for 40 years
- Single pay-pay once and get lifetime cover
If you want to reduce long-term burden, limited pay is a good choice. If you prefer smaller amounts, choose monthly payment. Use whichever of these methods feels easiest to you.
Check Online Reviews and Quality of Customer Service
Finally, check what real customers say about the insurer. Good customer service is very important because insurance is a long-term relationship.
Check:
- Online reviews
- Customer complaint figures
- The time it takes for a response from the company
- Social media comments
If most customers are happy, it is a good sign. It means the company will help you at every step from buying to claims.
Why these checks are so important
Many people buy term plans quickly, without checking details. Later, they realise:
- Their cover is too low
- Premiums are too high
- Claim process is slow
- Riders are lacking
- The company has many rejections of claims
A term plan is not something you buy every year. You buy it once, and it supports your family for decades. That’s why choosing the right life insurance plan matters a lot. Doing these 10 checks will help you choose a strong, safe, and simple policy.
Conclusion
When you buy term life insurance, you are not buying it for yourself. You are buying peace, safety, and stability for the people you love. A term life insurance plan is more than just a document. It is a promise that your family will never face financial stress, even in the worst situation. So, take your time, check all these points, ask questions, compare plans, and choose wisely. A good term plan is one of the best gifts you can give to your family.