Venkat is 26 years old. He wants to buy a Life Insurance plan for himself. It will provide a safety net for his retired parents and also help him save taxes. But he is unsure if he should buy it online or through an insurance agent. In an online
policy who will help him understand the product features? Or can he return the policy if he is not satisfied with it? Let us address Venkat’s concerns and help him understand the benefits of buying a Life Insurance policy online.
(1) Lower costs
The most significant advantage of buying a Life Insurance plan online is the substantial savings in premium costs. When a customer buys a Life Insurance plan online, the insurance company saves charges towards
intermediation – like commission to an agent, expenses towards setting up and maintaining a network of offices. Insurance companies are happy to pass on these benefits to the customer. As a result, Venkat can save up to 5% on buying
the insurance plan online as compared to offline mode of buying. Since Venkat is young and a non-smoker, he will likely get a term life plan with Rs. 1 crore cover for as little as Rs. 600 – Rs. 700 per month.
(2) Convenient
Since the buying process is online, Venkat can do it at a time and place that is suitable for him. He is not dependent on an agent finding the time to meet him. Further, Venkat can browse through the
websites of various Life Insurance companies, look at multiple products and their features before making a final decision. In an offline scenario, he would be dependent on choosing from products of the Life Insurance company that the agent
represents.
(3) Higher coverage
If Venkat is not worried about the cost savings, he can use lower prices to raise his insurance cover substantially. In effect, for what he will pay for an offline plan, he will likely get a bit more insurance
cover if he buys his Life Insurance plan online.
(4) Informed decision making
All Life Insurance plans come with a lot of riders. Prevailing regulations mean that insurance companies have to disclose all the information about the policy and various riders on their websites.
He can read up the information on his own and decide for himself whether to add riders with his plan or not.
(5) Compare insurance companies
Venkat can also check up on the reputation of the Life Insurance company in terms of customer services, claims settlement record and processing time, among others. This, again, will help
him make an informed decision. The insurance regulator publishes this information regularly and it is easily available in the public domain. With a little bit of research, Venkat can ascertain the quality of service provided by the various
Life Insurance companies.
[Also Read: How and When to Increase Your Life Insurance Cover]
(6) Free–look period
Once Venkat selects a Life Insurance plan, he has 30 days during which he can surrender the plan if he feels it is not suitable for him. This is called the free-look period and all insurance companies
must offer this to their customers. During this free-look period, the company personnel will call the customer and explain the product features. Venkat can use this opportunity to clear any doubts he may have about the product. This is direct
communication between the insurance provider and the customer and is, hence, useful.
Axis Bank has tie-ups with multiple Life Insurance companies – Max Life, Life Insurance Corporation of India and Bajaj
Allianz Life. Check out the Life Insurance plans, online.
Disclaimer: The Source, a content creation and curation firm has authored this article. Axis Bank does not influence the views of the author in any way. Axis Bank and The Source shall not be responsible for any direct/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information. Please consult your financial advisor before making any financial decision.
