Term insurance products are important for safeguarding your family’s financial future. This applies even to housewives, who make considerable contributions to the home in a variety of ways. While they may not have a steady salary, the financial consequences of their absence might be significant. Therefore, choosing the right term insurance for a housewife is essential. But what should you look for in these plans? Let’s explore the key features to consider ensuring you make an informed decision.
Features to look for in term insurance plans for housewives
- Coverage amount: The sum assured in a term insurance plan should be sufficient to meet the financial requirements of the family in the unfortunate event of the housewife’s death. Reflect on the family’s habits, current liabilities, and possible future expenditures, such as children’s education or marriage. A larger coverage amount can act as a reserve so that the family can continue with their lifestyle as desired in case of an unfortunate event.
- Premium affordability: While a higher coverage amount is beneficial, the premium should be affordable. Assess the current financial capacity of your family to enable you to set a premium that you are willing to pay without any form of hardship. Choose those that have feasible modes of payment, whether daily, weekly, monthly, or even per year.
- Policy tenure: The period of coverage of the term insurance plan should be consistent with the financial objectives of the family. For instance, if you have children who are below the age of working, it might be desirable to have a long tenure so that they are insured until they can fend for themselves. The different tenures provided by most insurers are between 10 and 30 years.
- Riders and add-ons: Riders are extra features that can be added to the basic term insurance plan. Some of the regular riders are critical illness cover, accidental death benefit and waiver of premium. These are additional forms of coverage and, depending on certain parameters can be as versatile as the core policy itself.
- Claim settlement ratio: The claim settlement ratio of an insurance company defines the ratio of claims that have been paid to the total number of claims made. Choose the insurance companies with the highest claim settlement ratio because this will ensure that you are not frustrated throughout the process. This information is usually published on the insurance company’s website and in the annual reports.
- Ease of application: The application process should be easy to understand and follow, as well as easy to navigate. Today most insurance companies provide online forms to fill out and apply for the policy from the comfort of your home. Make sure you receive enough assistance from the insurer especially when applying for the policy through the website or phone.
- Medical examination requirement: While some term insurance plans may call for an applicant’s medical examination, some do not. Non-medical plans can also be very attractive to housewives because of their ease in applying for the plan. However, all health-related information should be provided truthfully to avoid some difficulties in the process of claim payment.
- Renewability option: Determine whether the term insurance plan has an option for renewal. Another advantage of this feature is that it can be renewed after the expiration of the term without having to undergo another medical examination. It guarantees constant coverage which may be useful as the health status of an individual may change with time due to aging.
- Tax benefits: Term insurance plan are also eligible for tax exemptions under Section 80C of the Income Tax Act. The amount of premiums paid for the policy can be claimed as an expense while computing the tax and thus helps in saving tax. Furthermore, the amount received by the nominee as the death benefit is also tax-exempted under Section 10(10D).
- Inflation protection: Many term insurance plans allow automatic annual increases in the sum assured to match the inflation rate. This guarantees that the coverage amount is valid in the future to cater for policy value loss due to inflation.
- Grace period: If you are unable to pay a premium on time, there is a grace period that enables you to pay after some time without having to look for another policy. Generally, the insurers provide a grace period of 15 to 30 days for monthly premium payments and up to 30 days for annual payments. Knowledge of the grace period terms can help avoid such oversights and gaps in insurance coverage.
- Free-look period: Free-look period refers to a limited period within which you can go through the policy documents and reject the policy if you wish to do so. The free-look period ranges from 15 to 30 days from the receipt of the policy, which is offered by most of the insurers. This feature offers a chance to decide with all the necessary information without a loss of money.
- Policy lapses and revival: Learn more about the policies concerning policy lapses and policy revival. If the policy expires due to non-payment of premiums, insurers give a limited revival period within which the policyholder can renew the policy by paying the due premiums and interest. It is important to understand these terms to be able to continue having coverage even if at some point you have some problems with your financial situation.
- Nomination facility: Make sure that the term insurance plan lets you specify who will benefit from the amount stated in the policy in case you die. The nomination facility is quite important as it enables a housewife to nominate the family member of their choice so that the person in question can be financially secure and be able to claim the money.
- Policy customisation: The best term insurance plans should be offered to the buyer in the form that they can be tailored to suit their unique needs. Most of the insurance companies provide flexibility in terms of selecting aspects of the policy like the sum of the insurance, the duration and riders. Flexibility is another major advantage of customisation that helps the policy to meet your family’s specific financial needs.
- Financial strength of the insurance: There is a need to concentrate on the stability and popularity of the insurance company. This means an insurer with good financial standing will always be in a position to meet customer claims and offer quality customer relations. This can be done by analysing the insurers’ credit ratings as well as industry reports on the capacity of the insurer.
- No-claim benefits: In some term insurance plans, there are no-claim bonuses that may include a reduction in the premium amount or an increase in the sum assured, depending on the specific term insurance policy, provided no claims were made during a particular period. These are benefits that policyholders receive for continuing to uphold the policy and may be more economical in the long term.
- Customer service and support: The type of relationship between the insurer and the insured can play a very crucial role in the entire process. Select an insurer that offers good customer relations, good response to complaints, and fast delivery of services especially when processing claims. From a customer service perspective, proper handling of the tickets guarantees that any inquiries or complaints are resolved.
Ending note
Choosing the best term insurance for housewives in India involves finding out some of the features that will make it possible for housewives to be well protected. You can decide on a policy that will suit your family when you factor in the coverage amount, the cost of the premium, the term of the policy, add-ons, or optional benefits, claim settlement record, and customer satisfaction. A right-term insurance plan will also mean your family is secured financially even in your absence to ensure they have what they need in life. Let us also not forget that a well-informed decision today will go a long way to guaranteeing a financially secured tomorrow.
