In your family, you might be the earning member. Since you might be the family’s only breadwinner, your family would depend on you to take care of their financial needs. However, you can meet your family’s financial needs until you are alive. After your demise, you would not be around to provide for them. That’s where a term plan comes into play. If you have a term plan for your loved ones, you can ensure they receive financial support even in your absence.
Since a term plan is essential for your family, you should select your whole family’s right plan. While choosing a term policy, you should consider various factors like premiums, coverage, etc. However, a claim settlement ratio can be critical in purchasing a term policy. Before you buy a term policy, let’s understand what a claim settlement ratio is in detail:
As the name suggests, a claim settlement ratio indicates the number of claims your insurer has settled in a year. Simply put, it is the percentage of your insurance company’s total number of shares. The Insurance Regulatory and Development Authority (IRDA) might calculate India’s financial year’s claim settlement ratio.
A claim settlement ratio is an essential factor of consideration while purchasing a term policy. Therefore, let’s go through the top three reasons given below to help you understand why to consider a claim settlement ratio:
To ensure the whole process is simple.
As a policyholder, you should ensure the easy accessibility of the claim process for your family members. A complex claim settlement process can result in hassled decisions anddelaysy at the last minute. The claim process should have n minimal turnaround time banda quick claim settlement.
Usually, many companies might offer the usual three-step claim settlement process. The given below steps are simplified for your convenience:
- Report your claim, either online or offline.
- Submit the required documents to your insurer for verification.
- Wait for your insurance company to approve the claim.
To understand the credibility of your insurer.
The claim settlement record can represent tyour insurance company’s reputationin the market. Look for an insurance company with a higher percentage of claim settlement ratios. The higher the claim settlement ratio, the higher tyour insurer’s credibility
While buying an online term plan, you should check the claim settlement ratio over the past 3-4 years. A consistent claim settlement ratio can be a good indication tof choosingthe insurance company. For instance, any reputed insurer should have a claim settlement ratio of 95%-97 % in the market.
To receive quick approval.
The claims’ immediacy can ensure your family wouldn’t have to wait to receive the claim amount. As a policyholder, you should choose an insurance compan withs a low claim processing time. For instance, if your insurer requires quiet processing time, their aim can be categorized into two major parts:
- It is to provide genuine services and long-term assistance.
- It is to improve their sales in the market.
As highlighted above, your family’s financial security can be one of your life’s primary goals. With term insurance, you can protect your loved ones over the long run with the sum assured’s timely payment. In addition, choose a company with a maximum claim settlement record of over 90%. Such companies can guarantee the financial protection of your loved ones in times of eventuality.
