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If you compare the premium cost of online and offline term plans, there is huge price difference. In some case, you can get online term plan for about 1/5^th of the premium that you need to pay for offline term plan from the same company. The biggest benefit of the term plan is that they offer good life cover at very less premiums. Again, the online term plans make the life even easier for the investor. Some investors think that since online term plans are cheap, they are not as good as offline term plans. In this post, we will discuss the reasons behind online term plans being cheap in India.

How cheap is Term plan ?

The exact premium in a term plan depends on the age and health condition of applicant. Again, the premium also differs from one insurance company to another. It means that all conditions remaining same (age, tenure etc), a person has to pay different amount as premium for different companies. On an average, a healthy individual of 28 years can get online term insurance of Rs 50 lakh for 30 years by paying annual premium of 4000-6000. This is much cheaper in comparison to the offline mode.

Why are the Online term plans cheaper ?

There are a number of reasons behind this including:

• There is no agent involved when you buy the term plan online. Thus, the commission of agent is discounted from the premium.
• Another reason is that the operating cost in case of an online application is quite less for the insurance company. The companies have started rewarding the customers in return by charging less premiums.
• Now the final cause is that the target customers of these plans are healthy and young individuals in the age group of 25-35. As a result, there is less risk involved for the insurance companies and they charge less premium.

In brief, we can say that the insurance companies are charging less premiums for online term plans because it is economical and safer for them too. There is no risk involved in buying the term plan online provided you have basic knowledge of suing the internet.

The premiums for term plans are decreasing day by day. Things are expected to get better from the buyer points as all insurance companies are trying to lure new customers. Now this is good news for people who have yet not purchased their term plan and are thinking to buy one. But what about people who had already purchased their term plan in the past few years. Since, they had purchased it earlier; they have to pay higher premiums for the entire policy tenure. There is one option for such people and it is to discontinue the old policy and then start a new one. This way they will have to pay less premiums which will save a lot of money in the long run. But is it a wise approach? In this post, I will discuss regarding the factors to consider while changing the term plan.

Things to Consider Before Changing the Term Plan

• Your health Condition: As we know that the premium for a term plan also depends on the health of the individual applying for it. Thus, if you have acquired some disease after taking first policy, you will have to pay higher premium for the new policy. An important thing to remember is that the premium shown by premium calculators present on official website of insurance companies is not the actual premium. Once your medical is done, you are informed the exact amount of premium that you will have to pay. Another similar situation is if you have acquired the smoking habit during this interval. In this case also the premium will rise and thus it might not be a wise decision to change the term plan.
• Get the new policy first: An important thing to consider here is that first you should get the new policy and then discontinue the old one. This is just to remain on the safe side as there might be some problems in getting the new term plan.
• Early Claim: Another important thing here is that an insurance claimed within two years of starting the policy is referred to as early claim. In case of an early claim, the insurance companies check the whole case in detail. However, in case of policy being older, the checking is not that strict. Thus if your policy is 2 years old or more and you change to new policy, you lose this benefit.

How to Change the Term Plan in India?

Now that we have discussed the details related to changing term plan in India, the next question is how to complete the process. It is quite easy as you do not have to do any formality to stop a continuing term plan. You just have to stop paying the premium. J Once the grace period is over, the policy is discontinued. It is advised to buy the new policy before discontinuing the old one. This way you will remain insured during the transfer interval as well.

Riders in simple, words add additional benefits to the actual policy. It does not impact the actual policy rules in any way and provides you extra protection in addition to life cover from the insurance policy. There are different types of riders available and one might get confused while selecting a particular rider for his policy. An important thing to remember here is that one has to pay extra money for the rider benefit. In this post I will explain, the different riders available with term insurance and the points to consider while choosing them.

Different types of riders in Term Insurance

Here are the different types of riders in term insurance:

• Accidental Death: This is the most common rider available in almost all the term plans. This rider entitles extra compensation if the death of the policy holder occurs due to accident. For instance, suppose a person “A” takes term plan of Rs 20 lakhs and adds rider of Rs5 lakh. In this case, if A dies during the plan tenure due to accident his family will get a total of Rs 25 lakh. If he dies due to any other reason, he will be paid Rs 20 lakh.
• Permanent and Partial Disability: Another useful rider that allows compensation for the policy holder if he gets disabled permanently or partially during the insurance period due to an accident. The amount paid is certain percentage of the sum assured and it is paid for fixed duration (5-10 years). You should get the details checked from the official website or agent before opting for this facility.
• Critical Illness: If you opt for this rider, you are eligible for getting compensation in case of a critical disease during the insurance period. The diseases usually covered are heart stroke, cancer and paralysis.
• Waiver of premium: This a unique rider that allows the policy to continue even if you are not able to pay the future premiums due to disability or income loss.
• Income Rider: This rider is present in very few plans and it allows the family of the policy holder to get fixed income annually after his death.

How to Choose Riders while taking term insurance plan?

• First of all the plans do not have all the riders. In fact, talking about the HDFC Life Click 2 Protect, it does not allow any rider at all. While taking a particular term plan, first examine which riders are allowed by it. Thereafter, choose the riders you want as per your financial needs.
• The nature of work also plays an important role here. For instance, if you travel a lot, you should take accidental benefit riser for sure.
• There is no need to opt for all the riders allowed by the particular plan as you have to pay for each rider every year.

Almost all the insurance companies offer online term plan at concessional rates. This means that by buying the term plan online, you will have to pay comparatively less premium than the offline mode. The insurance companies are even promoting their term plans aggressively and the premium rates have also become much competitive. However, there are some people who are still doubtful regarding the online term plan. In this post I will explain in detail regarding how safe the online term plans are.

Why are the premiums less in case of online plan?

A common doubt with most of the investors is that since the online plan is cheaper, there will be problem in getting claim. Let us examine why the premium is cheaper. Firstly, when you buy the term plan online from the website of insurance company, there is no agent involved. As a result, you get concession equal to agent’s commission every year. Moreover, the cost incurred by the company in processing the insurance is also less. Finally, the target customers of these online term plans are young individuals that are health conscious. Thus the insurance companies are ready to provide higher cover with fewer premiums.

Will there be any problem in getting claim in online term plan?

If you have provided correct details while applying for the term plan, there should not be any problem in getting the claim. In fact, an important thing to note here is that whether you buy the term plan online or offline, the procedure to make the claim is same. However, it is recommended to teach your dependents about the whole procedure. This is because of the fact that you might be tech savvy but this does not apply to your dependents like parents. In case of death of the policy holder, it is the dependent/nominee who has to go through the claim process.

Precautions to take while buying the term plan online

You need to take certain precautions while applying for the term plan. Firstly, you should fill all the details correctly. If you face any problem, you can contact the customer support of the insurance company. You should co-operate with the insurance company in all aspects. Also, you need to pay all your premiums on time so that the policy is not lapsed. In case, you do have net banking account or are still not confident about buying the term plan online, you can buy it offline. For this purpose, visit the nearest branch of the insurance company and they will help you out. It is advised to get the proceedings done through a professional agent who does this work full time. This will insure that he will be doing the work for long time and can help your nominee in getting the claim accepted.

HDFC Life Click 2 Protect is the online term plan from HDFC and is making a lot of buzz in the insurance market. It is one of the most effective term plans present in the market today. The online plans target the young tech savvy people who are aware about the usage of modern technology and banking solutions. If you want to know the details of HDFC Life Click 2 Protect, this post will certainly help you. In this post, I will explain in detail about the features of this insurance plan, its benefits and limitations.

Features and Benefits of HDFC Life Click 2 Protect

The minimum sum assured is Rs 10 lakh while the maximum is Rs 100 crore. The person applying for this policy should have age between 18 and 65. The policy tenure is 10/15/20/25 and 30 years. One has to premium once in a year during the policy tenure. An important benefit of this plan is that you get 30-days looking period. It means that if you are not satisfied with the policy terms, you can return it within 30 days of purchasing it. You will get the refund of the premium after deducting the medical expenses and stamp duty. There is 30 days grace period from the premium payment date. Another benefit is that the insurance support team will itself remind you about the premium payment so that you do not miss any premium. One more advantage of this policy is that it is available in a huge number of cities in India. On the other hand, the online term plans from other insurance providers target the people from tier 1 cities only.

Premium in HDFC Life Click 2 Protect and comparison with other plans

Let us compare the premium in case of HDFC term plan and the other options present in the market.

Limitations in HDFC Click 2 Protect Plan

The first limitation is that the maximum age for taking the policy is 65 years. If you check the plans from other insurance companies, they allow up to 70/75 years. Thus if you are above 65, you will not be able to take this policy. Secondly, there is no provision of rider in case of this plan. The only solution in this case is to buy a spate accidental policy. One more limitation of this plan is that you can pay the premium only on annual mode. On the other hand, the other plans offer quarterly or semi-annually premium mode as well.  This can give more flexibility to the user. Finally, there are other plans in the market that are cheaper than the HDFC Click 2 Protect.

Should you buy HDFC Click 2 Protect

If you do not have a term plan, then it is certainly a good option. The claim settlement ratio of this company is quite good and the premiums are also affordable. However, if you already have a term plan with sufficient life cover, there is no need to buy another term plan.

Health insurance has become quite important these days especially for the people working in companies where no health benefits are provided. Sometimes, we might get inappropriate health insurance which can be a headache. Good news for such people is that now they can change the health insurance to another company. This is just like mobile number portability where you can change the service provider by filling the portability form. In this post, I will explain the detailed procedure on how to change the health insurance from one insurance company to another in India. I will also discuss the benefits of health insurance portability.

What is Health Insurance portability and how to get it done ?

Health insurance portability allows the consumer get his health insurance transferred from the current insurance company to a new insurance company. This facility can be availed for all the individual and family health insurance policies from different providers.

Here is the detailed procedure to avail this facility:

• First of all, you need to apply to the new insurance company at least 45 days prior to the premium payment date.
• Fill the required form given by the company along with portability form.
• Thereafter, the new insurance company will verify your details from the old insurance company in 7 days. They check all the aspects like patient history and past claims. You will be informed in 15 days if the new company has approved your application.

Benefits of Health Insurance portability

There are a number of benefits of this facility like:

• Firstly, you can switch to a new company that is offering the health insurance at fewer premiums. This also results in increased competition between the insurance companies and the consumers are benefited. The benefit is identical to that in case of mobile number portability.
• It can also improve the claim settlement ratio of different insurance companies in India. Moreover, you can expect better services from the companies as they will want their customers to stick to their policy only.
• If you have a pre-existing disease, the waiting period is carried forward even after you have transferred the insurance. In fact, the guidelines of IRDA clearly state that it is the responsibility of insurer to prevent the loss of insured caused due to transfer.

Should you use this facility?

An important thing to remember here is that the concept of Health Insurance portability is new in India. At such, you might not be able to get good support from the different insurance companies. In addition to the above mentioned benefits there are some demerits too. For instance, the features of two insurance policies are not same which can create confusion. Moreover, in case of pre-existing disease, you should be prepared to pay higher premiums after transferring the policy.

Do share with us if you have made use of this amazing facility or plan to do so. If you have any doubts, you can post it as a comment below.