Critical Factors You Need to Know Before Opting For An Insurance Plan

Thursday, August 10th, 2017 Amritesh 3 responses

Insurance Plan

Individuals are spoilt for choice while opting for an Insurance Policy. We have many Insurers offering many Insurance plans with varied benefits and features. Many Insurers are offering policies at a very low premium to lure potential insurance buyers. Most often buyers get attracted to cheaper insurance plans ignoring various other factors that one should keep in mind while opting for an Insurance plan.

Individuals should always keep an eye on the past record of the Insurer before opting for an Insurance Plan. One of the most important factors that one should keep in mind while buying an Insurance Plan is the credibility of the Insurer. There are various other factors that one should keep in mind while opting for an Insurance Plan.

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Factors that Individuals should keep in mind while opting for an Insurance Plan:

Claim Settlement Ratio: It is one of the factors which potential Policy buyers should be aware of before purchasing a policy. As it tells us how efficient the Insurer is when it comes to settlement of claims.

Claims Pending with the Insurer: This may be described the number of claims yet to be settled by the Insurer as compared to total number of claims received. This not only helps to find out the volume of business generated by the Insurer, but also the efficiency level at which they settle the claims.

Average Claim Settlement Time: This figure will help you understand the approximate turnaround time an Insurer takes while settling a claim. The faster the claim is settled the better it is, but the delay at times can also be attributed to the incorrect facts shared by the Insured while purchasing a policy.

Number of Claims Repudiated: This is another crucial data which one should carefully check before opting for a plan. It determines the number of claims which have been rejected on the basis of some grounds such as suppression or misrepresentation of facts or any other reason. It may happen that Insured had not shared certain facts or the Insurer did not conduct a proper verification before or within the stipulated period of issuing the policy. However, such rejections do not speak too well of the Insurers so one has to ensure that one is getting insured with a trusted Insurer.

Policy Coverage: Individuals also need to ascertain the Insurance coverage they require for themselves and their dependents. The cover should not only be adequate to meet immediate needs but also the future obligations. Consideration should be made for Outstanding Loans, Children’s Education and Health Expenses while deciding on the Policy Cover.

Read the Offer/Policy Documents in Details: It is advisable to read the Policy documents carefully to understand the stipulation, riders and regulation which binds the insured and also states the extent of coverage provided by the Insurer under the Policy.

The points mentioned above are some of the important aspects which should be considered before opting for a policy from any of the Insurers. Individuals can also probe beyond the points stated above to know more about Insurer so as to assure themselves that they get the best deal.

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Amritesh is an experienced professional in the field of HR, Finance and Compliance. He is currently working in the IT Industry with an US based firm. He took up Blogging as a hobby which eventually turned into passion. He primarily focuses on topics related to Personal Finance, HR, Compliance and Technology.

All the opinions/suggestions/views expressed on this blog are just for sharing information. Readers are requested to consult their respective financial advisers and experts before taking any decision. Views shared through post or comments are personal opinion meant for reference of the readers. These should not be considered as Investment Advice or Legal Opinion. The Blog or the Author does not take any responsibility regarding any such action taken by any Individual.
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3 Comments on "Critical Factors You Need to Know Before Opting For An Insurance Plan"

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I don't generally commentary on blogs but as I see this blog I completely motivated to make one praise that I understand that not enough for the significant context on your writing as one that could understand easily.

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I'm glad that it's a very successful year for them, congratulations 🙂

Nishant Rao
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Hi Amritesh,
Good informative blog. Thanks for sharing factor to be kept in mind before buying the insurance policy. This blog gives full of information what should be kept in mind before buying any insurance policy for any person.