Why One Has To Take Atleast Two Term Insurance Plan : A term plan covers all the risks related to the life of a policy holder. It is a type of pure life insurance in which the risk on the life of the insured person is efficiently covered by the policy. It is advised everyone to take term insurance policy to protect own life and family. It will cover your life with the lowest possible premium. In the plan, when the policyholder dies, the payout is made to the beneficiary made by the insured person. A term plan does not offer survival benefits which means if the policyholder is alive after the term, there is no monetary benefit to the beneficiary. The insurance companies offer many plans and one needs to choose it according to the need. Also, a policy holder should reassess theit plan and if it is needed then consider a second insurance plan as well.
When Death Claim Gets Rejected:
The following are some of the reasons why a death claim faces rejection:
1. When you provide incorrect/insufficient information in the proposal form.
2. When you fail to disclose accurate health history.
3. When you lapse of insurance policy.
Insurance companies settle the policies. To understand the efficiency of the insurance company, one should check the claim settlement ratio. It indicates the performance of the insurance company. So, by choosing more than one term plan, one can overcome the issue to some extent.
Advantages Of Two-term Insurance Plan:
Seeing the insurance needs, Two-term Insurance plan must be taken. The desired policy holder can have more than one beneficiary for the insurance plan. The Two-term Insurance plan provides:
1. Extra protection by taking more than one term insurance policy.
2. The beneficiary of the policy can avail death benefit from more than one policy.
3. If the claim gets rejected by one policy, the other covers it. In case, if one insurer rejects your claim, you will have a claim settlement from another insurer.
4. The different for different insurance policies have different claim ratios. With the insurer having a high claim settlement ratio, you will have high chances to settle the claim.
5. The desired policy holder can subscribe to an insurance plan based on the needs of their dependents. It will help in children’s education, children’s marriage and purchase of new house.
6. Before the end of the policy term, if the policyholder dies, the beneficiary will receive a lump sum payout under the death claim.
The insured person has to disclose complete information about the first insurance policy to the second insurance company. Misrepresentation of facts will lead to the rejection of claims.
Restrictions On Taking Two Term Policy:
More than one life insurance plan comes with certain restrictions as the sum assured by the all policies should not exceed the Human Life Value. The insurer will assess various kinds of health-related risks, before determining your premium and sum assured for the policy. Insurance company assess the risk. The annual income of the applicant is checked for the insurance policy.
To Claim Multiple Insurance Policies:
At the time of claim settlement, the insured person should furnish complete information about all the term insurance plans to the company. Insurance companies follow the guidelines laid down by the IRDAI (Insurance Regulatory Development Authority of India). It protects the interests of customers. If Insurance companies fail to settle the claim, there comes IRDAI to rescue.
How Does It Safeguard The Interests Of Beneficiaries?
Beneficiary of the policy (to which the claim amount goes) can claim on all the insurance policy. To claim the policy, the death certificate along with death claim form must be furnished that is collected from the concerned authorities. The insurance company will settle the claim within 10 days. Then, the company will check the credentials of the beneficiary and the payout will be made.
On the other hand, if the beneficiary fails to provide complete information, the insurance company can demand to submit the other necessary documents.
By buying more than one term insurance plan, an additional burden to pay the premium comes on you and you may find it difficult to manage multiple policies. But, you can go for multiple policies when the benefits outweigh the difficulties in managing the term plans. It will provide more benefit to the beneficiary.
