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Buying online term insurance vs offline - comparison

NOVEMBER 1, 2018

Buying an online term insurance is becoming increasingly popular in India. The virtual plan in its most basic form is different from its offline counterpart, this is unlike an offline plan, where you would be assisted by a mediator or agent who not only takes care of the entire process but also gives you the assurance that he has the best of your interests in mind. So, without the aid of an agent, why is an online term plan gaining more traction?


Reasons Why They Are Popular

Cost Effective: Most online life insurance plans work out to be almost 50-70% cheaper compared to their offline counterparts. This is primarily because no agents are involved, thereby eliminating agent commissions/intermediary costs. You are directly connected to the company via their website, hence there is no room for any commission to broker or agent.
In an offline plan for every premium paid, a certain percentage goes to the broker. However, when one buys an online plan, all these costs can be saved, and the company passes on these benefits directly to the customer in the form to lower premiums.


Freedom of Choice: When you go to an agent or broker, they are more inclined to selling you a plan that is aligned to their company, buying online means you have the freedom of choice. You can go through pans that are listed on the website to understand which one suits you best, also what riders do you want to add as per your individual needs. You can go through the fine print to understand all the nuances of the terms and conditions, so that there is no confusion and misunderstanding related to any aspect of the policy. If any clarity is required, you can connect with the customer care representative, who will answer all your queries.


Lesser Probability of Fraud: As you are the person undertaking the entire process of filing for an insurance, there is no chance of getting duped, which could be possible with an unscrupulous insurance agent. Moreover, since all the formalities are filled up and submitted by you online, you have the entire transaction history on record. You can use the same in case of any issue at a later point.
Clarity about Rejections: Gauging an insurance company's online claim settlement ratio can be difficult, as the online and offline data is generally clubbed together. Many people feel that the risk factor of rejection becomes higher online. But the IRDA's regulations make the process more secure. There are certain guidelines set by insurance regulator, Insurance Regulatory and Development Authority, (IRDA). For any claim within the first two years, insurers have a timeframe of six months to investigate and settle the claim. For policies older than two years, there is a 90-day period during which the settlement must take place. It doesn't matter whether you have taken the policy online or offline, the claim settlement will undergo the same scrutiny. There is no data till date that will support the often-heard broker claim the number of online policy rejected during settlement is higher than the offline ones.


Convenient: With the availability of the entire process online, you can make your purchase whenever it is convenient for you. Not only can you compare among different plans to choose one that suits you best, but websites also offer features like application status and insurance premium calculator, which help you understand the costs involved and choose accordingly. Whether day or night, you can just go to the website, read the details and be done with filling the application form in just 30-40 minutes. With so many advantages, buying an online insurance policy is possibly the easiest thing you could do!

Disclaimer:
The article is meant to be general and informative in nature and should not be construed as solicitation material. Please read the related product brochures for exclusions, terms and conditions, warranties, etc. carefully before concluding a sale

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