Should you buy life insurance offline or online?

The Covid-19 pandemic has shaken the world over the last one year or so. If the first wave was not enough, the second wave of the virus spread has been wreaking havoc across the country at an unprecedented magnitude. As per official statistics, over 160 million people across the world have been infected by the virus. Meanwhile, India, with over 23 million infections, has become the second-most affected country, next only to the US. And with over 2.5 million cases being reported every week, it is only a matter of time that India overtakes the US to become the worse-affected nation in the world. ^[1]

While vaccines are being rolled out to contain the crisis, it may take a long time to vaccinate the entire population. Many families have lost their breadwinners, which has endangered the families’ financial well-being. For many such families, the realization of the importance of a back-up plan or protection unfortunately came quite late.

While the ongoing crisis may have brought this realization for many others, the need for a life insurance policy has always been there. After all, an emergency can strike any time and one need to be prepared for it. But, first know the answer to the question - What is life insurance ? and understand its benefits.

Importance of Life Insurance

Amid all the uncertainty due to the Covid-19 pandemic, having a sound life insurance policy can bring some sort of financial certainty -- a certainty that your family or other loved ones and their goals would be taken care of even if something happens to you and you are not there to protect them yourself. If you are a policyholder, this means that your nominees do not have to compromise on their lifestyle. The insurance pay-out can be utilised for monthly expenses or critical life goals, such as the education of children or their marriage. 

Moreover, a life insurance policy can also prevent the comforts -- like your car and your home -- from turning into liabilities. While planning for the sum assured, you should take your loans into account so that if something happens to you, the burden of the loan repayment is not passed on to your family and the insurance pay-out takes care of it.

Things to keep in mind while purchasing life insurance

While a life insurance  can come to the rescue for your family in such a situation, just having a policy might not be enough. There are some other things you may need to consider to ensure complete financial protection for your family. 

The first and foremost is choosing the right sum assured. Your family can lead a comfortable life in your absence only if the pay-out under the insurance policy is enough to compensate for the lost income. It is advised to keep the sum assured  at least 15-20 times of your annual income to be adequately covered, if not more, however this depends on inpidual’s needs and risk appetite. The second important thing to consider is the add-ons that you choose along with the policy. Add-ons, often called riders, are some extra benefits on top of the base policy. You can choose from add-ons of critical illnesses, accidental death or disability 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 in the policy terms and conditions. In other words, the pay-out can be used for treatment or as an income replacement. 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. This is over and above the base sum assured. By choosing the appropriate riders, you can make your backup plan fool-proof.

The most important factor to consider when you buy a life insurance plan is choosing the right insurer. Because no matter how good a policy you choose, it could be of no benefit if your family has to face issues during claims. 

Bajaj Allianz Life Insurance  has a claim settlement ratio of 98.48% ^[2]. 

Buying the Policy Online vs Offline?

While you can buy a policy offline by visiting the insurer’s office or contacting an insurance agent, buying it online is easier and quicker. Moreover, why take the risk of exposure to the deadly coronavirus when you can purchase the policy online from the comfort of your home? Also, buying insurance online could be a lot more convenient. Not only that, you can also compare plans from different insurers and benefits offered under different plans before choosing the policy that is suitable for you. 

You could consider Bajaj Allianz Life Smart Protect Goal - A Non-Linked, Non Participating, Pure Life Term Insurance Plan that gives you a three percent discount on online purchase. ^[3] The premium is as low as Rs 21 per day for Rs 1 crore cover  ^[4] and comes with protection against 55 critical illnesses ^[5]. It also comes with child education cover and return of premium option  ^[5].

There is no doubt that having a life insurance policy is crucial, even more so now with a drastic increase in the uncertainty due to an unprecedented health crisis due to the COVID-19 situation. There are significant benefits of buying a life insurance policy online and you must consider evaluating that option. However, what’s more important is getting yourself adequately covered. If you already have a life insurance, ensure that it is sufficient. If you do not have a life insurance, get one today. If, for any reason, you are unable to purchase a policy online, that should not stop you. You can also buy the policy offline through an insurance agent. For the security of your loved ones, get yourself covered today!

References - 

[1] https://www.worldometers.info/coronavirus/country/india/
[2] Individual Claims Settlement Ratio for FY 2020-2021
[3] Discount is available for regular premium and limited premium payment frequency under all variants of this product.
[4] Above illustration is considering Male aged 25 years | Non-Smoker | Life Cover Variant | Policy term (PT)– 30 years | Premium Payment Term (PPT) – 30 years | Sum Assured opted is Rs. 1,00,00,000 | Online Channel | Medical rates | Annual Premium Payment Mode | Premium shown above is exclusive of Goods & Service Tax/any other applicable tax levied, subject to changes in tax laws, and any extra premium and is for illustrative purpose only.
[5] Product feature/benefit mentioned above are dependent on variant chosen

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