Tips and Advice before Buying Life Insurance


When buying life insurance to secure the future and protect the family, there are many companies in the market to consider. These companies provide varied customized plans tailored to fit an individual’s needs. Choosing a policy or term plan that fits your needs can be a daunting task. Listed below are a few tips and tricks that will help choose the right plan.

There are three different ways of buying a life insurance:

1) Directly from the insurance company

2) Through a company appointed insurance agent

3) Via an independent insurance broker

It is advised to buy life insurance from an independent broker. A trusted independent insurance broker may be the first person to discuss the life insurance policies. Just be aware that the broker may present several types of life insurance and the choices may be overwhelming.

Tips and Advice:

  • Don’t Wait: Since your age is directly proportional to the rate of premium, don’t just wait to buy a life insurance policy. A young buyer will be offered lower rates of premium compared to an older buyer. This is simply because young people are healthy and there are lesser chances of death. So, it is always good to buy a life insurance policy as early as possible, to enjoy a lower premium throughout the policy term.
  • Stay Healthy: A medical check-up before buying a life insurance policy reveals your health condition to the policy provider, based on which the rate of premium is decided.
  • Choose the policy term wisely: You will always have the option of choosing the premium payment mode while buying a life insurance policy. The payouts can be made monthly, quarterly, half-yearly and annually.
  • Opt for an online policy: When buying a life insurance policy online, you will deal directly with the company and there is no involvement of a middleman. With this, the company saves the cost of commission. By saving money on commissions, companies offer a low rate of premium on life insurance policies for their online buyers.

How to Buy the Best Life Insurance?

  1. Coverage: Calculate the life cover. The life insurance advisor can help calculate the life cover that the policy has to offer. The advisor will assess the source of income, debts, liabilities, number of dependents, etc. The advisor will also be able to decide the best plan for a person. In case of other personal requirements like children’s education, pension etc., you should discuss the same with the advisor and trust him/her to come up with an ideal plan.
  2. Individual needs: To buy the best life insurance policy, you must determine the basic needs. It is advisable to buy insurance if you have several dependents.
  3. Lifestyle: The premium charged on an insurance policy varies based on the lifestyle of the policyholder. A person who drinks or smokes a lot will be charged a higher premium compared to a person who doesn’t. Policies can be compared instantly online at before purchasing, in order to ensure that they are pocket-friendly.
  4. Riders: Riders are add-ons that insurance companies provide to the policyholders for an extra premium. It enhances the policy coverage. Some companies provide riders while others don’t. Opt for riders only if really needed.
  5. Compare: Different companies provide different plans. You should choose a plan that best fulfills your needs. Check online and compare the policies of different companies in detail. Some of them may provide riders as an inbuilt feature.

Benefits of Buying the Best Life Insurance

  • Low cost, high benefits: A small number of premium insurance companies offer significant layout. For example, a term insurance plan offers extensive coverage which is quite huge in comparison to the amount of premium paid.
  • Assured income through annuities: When it comes to retirement planning, life insurance is one of the best instruments that offer steady payouts in form of annuities.
  • Tax Benefits: Life insurance policies can be used as important tax planning tool, as the policyholder is eligible to avail tax benefits under the Income Tax Act of 1961.

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