The question is quite pertinent because of many factors .First it gives an opportunity to the policy holders to select the right product with the right features due to better comparison of options possible through the online mode which is technically not present in the offline mode. This means that technology has given more powers in the hand of the consumer now. Secondly online option lets you not fall in trap of misleading offline agents who promote a particular product because of higher incentives where they have no intent of serving your needs. A data released in 2013 shows a sheer number which reflects the bad effects of misspelling. In data released by the industry showed that “Investors lost close to Rs.1.5 lakh crore of money due to mis-sold insurance policies”.
But do you think are these the only reasons why you should be buying a term insurance online .The answer is no. Let’s look at real factors based upon that can help you decide why you should use the online mode to buy term insurance.
1. Cost of the policy: if we look out the term insurance plans available today, you will generally find the offering of the online mode is bit different. For the same amount of term cover you generally pay closer to 50 -70 % less premium compared to its offline peers. But why this is so? Mortality risk is one of the important factors which decide on the premium that you pay for a sum assured under a term policy. Insurance companies always believe that mortality risk for online customers is always low because they are more informed about things and they will always have chance of living a longer life because of access to quality information.
2. Flexibility: The online mode provides for better flexibility to the customers for choosing the right option and the required term. Though you might require to do bit of more homework compared to offline mode because in case of offline mode you generally become lazier because you have the agent to serve you for all possible needs starting from the filling the proposal forms. But all these laziness can lead to issues relating to claims settlement and sometime frauds also.
3. Claim settlement process: For insurance companies whether you are online or offline customer the claim settlement process is always the same. It is not the case that insurance company would give an offline customer more privilege compared to an online one because you have paid a bit less premium.
4. Sum assured: The average sum assured that you can get out of an online term insurance plans is always higher for the same amount of premium compared to an offline because the cost is low. You generally don’t need to go through any medical test if you have enrolled for a sum assured which is less than Rs.50 lakhs.
If you compare the online by Term insurance premium calculator based upon the factors listed above makes it a clear winner. But before you plan for a term policy whether you are buying it online or offline you should be first very clear about the amount of cover you should actually look for. If you go by the right definition of term insurance then it is actually the right insurance product in terms of keeping yourself financially healthy. Do keep in mind the online mode can be boon for you but while filling the proposal form for policy do disclose all possible information about you and your health otherwise you may have to face problems in case of claim settlement.