Benjamin Franklin once said that, “In this world nothing can be said to be certain, except death and taxes”. While, we are always planning for how to save taxes, we never intend to plan on how to deal with the latter one. We never take death as a serious enough matter to plan for or even deal with and buying a term insurance is the last thing that comes to our mind. However, with more & more responsibilities added, we start thinking about a backup plan to protect our family & loved ones if something goes wrong.
In scenarios like this, term insurance plans come to your rescue. However, once again finding the best insurance companies in India is not a quite easy task to follow. To understand the concept of term insurance, what its importance and how to choose the best one for you & your family, let’s begin with its basics.
First of all, we need to understand the ranking procedure of these insurance companies in India and how the ranking of these insurance companies is decided. Have you ever thought about the fact that why every other person amongst us swear by the Apple brand for mobile phones or why they blindly follow brands like Jimmy Choo & Armani when it comes to lifestyle & fashion? Because these are known to be the best brands in their respective sectors and have made a reputation by earning trust amongst their consumers. Like every other sector, even insurance sector has its best and worst brands. The Insurance Regulatory and Development Authority of India (IRDAI) is the regulatory body that decides the ranking of different insurance companies in India.
Let’s have a look into the data showcasing the top 10 companies that have been designated as the Best Insurance Companies in India by IRDA:
- Life Insurance Corporation of India (LIC)
- Max Life
- TATA AIA Life insurance
- ICICI Prudential Life insurance
- Aegon Religare
- HDFC Standard Life
- Reliance
- SBI Life
- Canara HSBC OBC Life insurance
- Bajaj Allianz Life
There are several parameters, based on which IRDAI releases its annual report to determine the ranking of the best health Insurance Companies. Few of them include Claim Settlement Ratio (CSR), Volume of Business and Solvency Ratio.
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Claim Settlement Ratio (CSR)
This ratio shows the number of claims settled by the insurance company against the number of claim received by it. The more the company is able to settle the received claims, the more the company is trustworthy to put your money in.
Volume of Business
It means the total number of policies received by an insurance company in a year and the total premium earned from those policies. This attribute of an insurance company further adds to its trust factor and is a bonus factor for both the company as well as the customer. For an insurance company, the higher business volume depicts higher revenue and hence showing the strong goodwill of the company. For customers, it’s beneficial because a higher volume of business clearly means that more & more customers buy insurance from the said company and hence, one can easily trust the brand and be assured about the safety of her/his money.
Solvency Ratio
This ratio shows the number of claims received and solved by a company at a time. For instance, in case of a natural calamity such as earthquake or flood, an insurance company is bound to get bulk claims. If the company has sufficient assets to deal with these and is able to settle those claims despite of the fact that they are huge in number, it means that the company has good solvency ratio.
Costs Involved
Let’s be honest with ourselves – expenses play a vital role to help us finalize our decision while looking for the best term insurance plan to invest. The term plans with lower expenses clearly means lower premiums to pay for the plan; hence, saving big while getting the desired benefits. Also, there are some insurance companies in India that provide discounted offers to special segments of their customers, such as discounted premium rates for non-smokers.
Enhanced Cover
You should also focus on the flexibility of a term insurance plan while finalizing the one for your family. There will always be a new set of responsibility added to your shoulder at every next phase of your life. If a policy allows you to enhance your life cover by 50% at the time of your marriage and by 25% when you become a parent; it gives you a possibility to start with a modest cover and enhance cover as your responsibilities increase and also your ability to pay more.
Across the wide range of insurance companies in India, it’s quite a tedious task to find the right term insurance plan to invest. Thanks to the internet- the process is now much accessible and easier (as compared to the earlier era of endless paperwork). You can even buy a term insurance plan without going through the tedious task of going through a series of different medical tests.
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