Term Plans are a popular form of insurance because of the relative value they provide with high covers and low premiums. These plans work on the primary objective of protecting against risk and bringing you some peace of mind by keeping you assured that your family will be taken care of in times of need. Term Plans can be bought in two ways: offline and online. These plans differ in price by some margin, and most individuals aren’t sure whether to opt for an offline or online Term Insurance. Let’s take a look at the parameters that differ while buying an online term plan and an offline term plan.
Yes, you did read it right! Premiums do differ for offline plans and online plans. When compared, premiums for offline plans are usually higher.
When you’re comparing offline and online plans, an important aspect that works for an online policy is the option of comparing different policies offered by various providers via aggregator websites. Through these sites, you can compare policies in terms of their features, their offerings, and their shortcomings. This makes it much easier for you when you buy term insurance online to choose the insurance provider. In the case of offline insurance, you have to depend on what your insurance agent says. The agent may only focus on the policies of particular brands. Comparing offline policies upfront may become too cumbersome to do on your own.
Buying policies online is fast, simple, and free of hassles. Right from your smartphone or your laptop, you can browse, select and purchase an online term policy any time. Unlike an offline plan, there isn’t any need to wait for an agent, visit a branch, or wait in queues while you buy term plan online.
In online plans, you will need to fill in the necessary details all by yourself. At any time, you can verify your doubts and queries while filling the form. For offline plans, individuals could be negligent and depend on agents to fill in the form. Any non-disclosure of facts by agents in the policy could lead to a rejection of claim at a later point in time.
Online plans come with a lower premium, and high sum assured given the reduced serving costs and low mortality risk. The plans range from Rs. 5 lakhs to Rs. 5 crores and possibly more. Although the same plans are available offline, applicants are usually seen settling for lower sum assured, mainly because of the high premiums that have to be paid.
Claim settlement ratio
Offline plans usually do not offer much clarity on settlement ratio. Insurance companies need not disclose the claim settlement ratios for online plans. The ratio given to the Insurance and Regulatory Development Authority (IRDA) is a combination of both offline and online claims.
No matter your choice of purchase, you should do thorough research, look at different policies, read the fine print carefully, ask all your doubts and queries, and sign the papers only when you are entirely sure of your decision.