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The best insurance policy in India – Choosing the best one for life

Unplanned expenses in life are a bitter truth. No matter how much you plan for your life, but life will take its own course. You cannot control what happens or how something happens in life but you can be prepared. This is where insurance policies available in India come in. Choosing the best insurance policy in India can be a daunting task if you are not aware of all sorts of policies available and what are the factors to consider.

In simple terms, insurance will provide you with a shield from all sorts of unforeseen expenditures that can hamper your or your loved one’s lives. There is a wide array of insurance policies available in India. However, if you know what to check, you can get the best insurance policy in India with ease. Before we share the factors to consider while getting insurance policies, here are the following types of insurances you can use.

What are the types of insurance policies available in India?

Life Insurance

This is a policy or coverage where the policyholder can guarantee financial freedom for the family members in case of his/her untimely demise. It is very beneficial if the policyholder is the sole earning member of the family.

Health Insurance

This is a kind of general health insurance that offers financial help to the policyholders in case they are admitted to hospitals for treatment on health issues. Also, there are certain plans that cover the complete cost of treatment that is incurred at home before the patient is hospitalized or after discharged from the hospital.

 Motor Insurance

Motor insurance is also known as car insurance that offers financial assistance for all sorts of car accidents, and damage to your automobile. The motor insurance is available as car insurance for four-wheelers, two-wheelers, and commercial vehicles.

Property Insurance

Property insurance includes covering any buildings or immovable structures. You can insure your residence or commercial space. In case of any damage to your property, you can claim the financial help from the insurance providers. Property insurance also protects the contents inside your home.

Travel Insurance

Travel insurance policies ensure the safety of a traveler on any trip. This is a short term cover. It is available for domestic travel, international trips, and home holidays.

Mobile Insurance

Due to the rising price in smartphones, a lot of individuals opt for mobile insurance policies. For any accidental damage, you can claim the amount you spend on repairing the mobile if you have mobile insurance. It is useful in case of screen damage and theft/robber of smartphones. Also, mobile insurance policies safeguard the value of a new smartphone.

Bite-Size Insurance

This is a sachet insurance plan which will reduce your financial liability for a short term, say, a year. These insurance plans will protect your finances against specific threats or damages.

Cycle Insurance

Cycle insurance plans are available in India because they are very useful for the daily commute. A lot of people rely on these to travel long distances as well. A cycle insurance policy will make sure that you have access to the required funds in case there is any accidental damage to your cycle or theft. It will save a lot of pocket expenses along with ensuring immediate repairs for vehicles.

Now, choosing the right kind of insurance will act as a wild card to your finances. There are numerous benefits to it. So how should you choose your insurance policies?

What are the factors to choose the best insurance policy in India?

  1. Your current and projected income

This is the first and foremost factor in choosing the best insurance policy in India. Your choice of insurance policy should be based on the amount of the present and projected income. In simple terms, how capable are you to pay the premiums per month? Also, the insurance agencies will ask about your age, medical state, future financial plans, and more.

  1. Cost-benefit ratio

These are the benefits you receive on your insurance according to the amount that you pay. The cost to benefit ratio will depend on what is covered on the insurance policy. Thus, you have to keep an eye on the cost of the insurance and make sure that it justifies the benefits covered in the policy. Simply put, there has to be a balance between the costs and benefits available in the policy. Most importantly, you have to make sure that the policy covers the dependents in your family and the majority of health problems.

  1. Consider the policy statements

This includes the promises done by different insurance companies. It will depend on whether you are looking for pure insurance coverage or you need an insurance cover along with an investment opportunity. There are four primary forms of insurances that people choose, especially if it is for a limited period.

  1. Term Insurances – The term life insurance, also known as the term assurance, is insurance coverage for a limited period of time.
  2. Endowment policy – An endowment policy is also known as the life insurance policy that includes a contract where you pay a lump sum amount of money after a specified amount of time (especially on maturity), or upon death, whichever is earlier.
  3. ULIP’s – It is known as the Unit-Linked Insurance Plan that offers life insurance for life. However, the policy value can fluctuate at any point in time depending on the value of the underlying assets.
  4. Money-back policy – Unlike any other ordinary endowment insurance plans in which the survival benefits are paid only at the completion of the endowment period, the money-back policies offer for periodic payments for the partial survival benefits at the term of the policy.

While comparing the different plans it is important to keep in mind the factors that we mentioned above. While choosing the best insurance policy, it is important to correctly identify your financial needs and your dependent’s requirement as well. A general rule is to choose a policy that offers ten times more than your salary.

Yes, you can opt for more as well, but it varies according to the needs of the policy buyer. Since you will be deciding how much your dependents will receive in case of death, health issues, car issues, you have to keep in mind the above factors and compare the plans accordingly.

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