The Fact Maker

Things to know before buying insurance

Life is full of possibilities, but it’s also filled with uncertainties. Along with the joyous big events of life – the first job, getting married, having children – you may also face losses in the form of accidents, illness, and natural calamities. Instances such as these are many and, yet the result always has a financial repercussion. While you can take measures to control or limit the financial losses, you cannot avoid them altogether. Here’s where Insurance comes in – it’s the best way to mitigate these losses and stay prepared for these uncertainties. Insurance plans compensate you for the loss suffered. By opting for an insurance plan, you can safeguard yourself from financial strain in an emergency.

What to know before buying Insurance

(i) Right Timing

As we go through different stages of life, our insurance needs change as well. It’s important to know what kind of Insurance plans you would need based on your age group. As you build a family, it becomes crucial to factor in the needs of your family members while choosing these plans. Parents with young children need to be able to save for their education, while at later stages, your needs might change to comfortable retirement, health exigencies or children’s marriage.

(ii) Right Amount

It’s not easy to estimate emergency expenses but you can better calculate how much you need to get insured for by looking at factors like your salary, age, and employer coverage and provisions.

(iii) Right Insurer beyond Brand & Price

Looking at the following factors can go a long way for getting the right kind of coverage:

Claim-settlement ratio: If this number is closer to 100% then this is a better choice as you would be compensated better in the case of an emergency.

Network of Hospitals for Health Insurance: It becomes easier to avail Health Insurance benefits if your insurer’s services are available across a large number of hospitals and departments along with cashless insurance facilities.

Network of Garages for Motor Insurance: Ease of access to a facility is crucial while picking car and bike Insurance plans.

Popular Insurance Myths – Busted!

1. “Insurance is an investment”

An insurance product should not be treated as an investment tool as the primary objective of any insurance product is to provide financial assistance in case of any unfortunate event.

2. “Insurance is expensive” 

It is a common notion that insurance is costly. As insurance covers for the future losses (life / health / assets) that one may incur, from a cost benefit analysis, insurance is a cost-effective way for covering these losses. It also provides tax benefits, thus reducing the outgo further.

3. “I am employed and my employer provides health insurance. So, I don’t need another plan”

Currently you are working and your employer has provided you with a health insurance cover. Great! But have you considered the following:

1. Is your family covered as well?

2. Will your health insurance provide your coverage if you leave your job or are in between jobs?

3. Is the health cover provided by your employer comprehensive in terms of benefits and coverage amount?

If the answer is no to any of the questions, then you will need personal health insurance for yourself and your family.

4. “Insurance is complex/difficult to understand”

While some of the insurance terms are technical in nature because insurance is a legal contract between the insurance company and the proposer, we at PhonePe have tried to demystify terms as much as possible.

5. “I need to step out of my house to buy insurance”

Not anymore! PhonePe brings the entire purchase process, including uploading of required documents, online at your fingertips.

To sum it up, buying Insurance is the right choice for everyone. It keeps you prepared and protected against any surprises life may throw at you, so you can live worry-free and enjoy life with your loved ones.