There are quite a few things that you should always endeavour to ask your agent prior to purchasing a life insurance policy. These questions and their answers (whether satisfactory or not) will determine whether you ultimately end up buying the life insurance policy or not.
· What are the premiums for the life insurance policy- You should always ask about the monthly premium payable or the annual premium payable for your life insurance policy. This will help you compare premiums and make the right choice.
· What are the lifestyle aspects affecting the policy- Most insurance plans usually have lifestyle aspects which are evaluated prior to the policy being issued and the premium amount decided upon. Ask about these in advance.
· What should you do in case a premium payment is missed/is late- The benefits of the life insurance policy can be impacted in case you miss a payment or pay late. Ask what happens in such a scenario.
· Which is the insurance company and what is its track record- Always ask about the reputation of the insurance company, its track record and claim settlement ratio in order to take an informed decision. This is probably the most important question of all.
· What is the lock-in period for the policy- Many insurance plans, particularly ULIPs and others have lock-in periods prior to which the accumulated money cannot be withdrawn in case there is a mixture of life coverage and investment. Ask about this prior to investing in any such policy.
· When does the premium have to be paid- Ask about the frequency of payment, i.e. monthly, yearly, bi-annually or half-yearly or even quarterly. This should be clarified well in advance.
· What is the surrender value of the policy- The surrender value is the amount to be received in case the policy is surrendered voluntarily prior to maturity. This varies and should be figured out based on the tenor and amount which is the sum assured.
· Are there charges payable upon surrendering the policy- Always know whether a portion of the surrender value will be charged by the insurance company or not. Ask about this aspect and then decide. Ideally, the surrender charges should be on the lower side.
· Are there any added benefits- Each life insurance policy will offer coverage but what you should also ask about are the additional benefits. You should always know more about the added features, top-up provisions, bonuses and other riders.
· Is there any Free Look period- You should always ask the agent whether there is any free look period of at least 15 days or so before the policy holder finally decides whether to keep the life insurance policy or get the paid amount refunded. This should be learnt carefully.
Apart from these 10 key questions, you should also ask about the procedure for changing the beneficiaries which will only help you in the long run. These vital queries should be asked before you buy your policy and they should help you take the right decision by all means.
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