Ritesh is a life insurance agent who organizes various insurance-related awareness programs in association with various NGOs. He has also conducted programs under IRDAI's insurance awareness campaign called ‘BimaBemisaal' in colleges and offices.
During these campaigns, he fielded various life insurance questions and answers from all age groups. A few of the frequently asked life insurance questions were about life insurance company services.
Q: Where do you buy life insurance from?
Insurance policies are sold either directly by insurance companies or through various intermediaries or channel distributors.
In India, the majority of new life insurance policies are sold through intermediaries - individual life insurance agents, insurance brokers, corporate agents, web aggregators, etc.
Today companies are leveraging online models to sell insurance policies through the internet. It is more favorable for people who are comfortable with the internet and the usage of online tools.
Be it online or offline through any advisor, buying a life insurance policy is an important part of financial planning.
Q: What services do life insurance companies provide?
Clients often feel that the services provided by life insurance companies and advisors are limited to selling plans. However, that’s not true. While selling plans is an important aspect, there are various other roles that company advisors play. They help and support you in your overall financial planning. Their inputs can be broadly divided into three categories - pre-purchase, during purchase and post-purchase.
Here is a comprehensive list:
1. Provide knowledge about various products in the market, highlighting their features and benefits. In insurance ‘one size does not fit all’.
2. Conduct financial planning exercises by considering your assets and liabilities, your standard of living, age, annual income, and recommends solutions that fulfill your long-term savings and protection goals. That is they ensure that you buy a policy that you can afford.
3. Analyze your life risks and thereby suggest the type of plan that would suit your needs – whether a traditional policy would be better, or a market-linked plan.
4. Help identify your future financial goals – family protection, child education, retirement planning, and wealth creation. They also help you arrive at a specific amount that you will need in the future to achieve these.
5. Inform about the right amount of premium you need to pay for your policy, including its frequency and mode. This helps you achieve your financial goals.
6. Explain the importance of a nominee for your policy. A nominee is a beneficiary who will get the sum assured and other benefits of your policy in case of your untimely demise. Your nominee could be your spouse, parents or any other family member that you feel financially responsible for.
During Purchase -
1. Explain the necessity of providing correct and updated details, about your health, income, lifestyle, and other policies, in the proposal form. They also advise you on all the necessary correspondence details to be provided, like your complete postal address, primary and alternate contact number, email ID, etc. Providing incorrect information can lead to claim rejection. Remember, no insurer likes to reject.
2. Help understand the policy documents. They answer all your questions and make sure there is no confusion regarding the policy.
3. Advise you to select the best options with the plan - the addition of riders, selecting the tenure of the plan, choosing the right funds, payment modes, etc.
4. Assist and help you with all the medical tests and other related formalities as well.
Post Purchase -
1. Conduct yearly assessments to know about any new requirements and provide solutions accordingly.
2. Help service your plan. They assist with modification, redirection, and can even help you switch to another plan. Moreover, they collect renewal payments and provide reminders for the same. They assist you/ your loved ones during the claim settlement process. Claim settlement is one of the most crucial aspects of a policy. They ensure that all the correct documents are submitted to the company in time which helps in smooth settling of claims. They coordinate with the claim settlement officer and ensure that you/ your loved ones get the claim amount
3. If required, they also ensure that your policy continues for the entire term.
Q: How can a life insurance agent/ intermediary be identified?
Now, that is a good question. A life insurance agent.intermediary is duly licensed to sell life insurance. So, make sure to seek the agent's/intermediary’s license, identity proof, and a business card of the company he represents, when you meet him/her. If you have any doubts, you can always call the company representatives to confirm.
Note that agents/intermediaries are trusted and experienced professionals who partner and assist you in taking the right decisions. They help you review your policies regularly, intimate you about the changes, and even follow up for premium payments.
Q: Is there anything to watch out for when dealing with a life insurance agent?
Yes. Beware of agents making tall promises or trying to oversell a product. Be sure to purchase only what you can afford. Don’t get into the trap of phonies. Please remember, if anyone makes unbelievable promises of stupendous growth on your investments in a short span of time do not fall for it. Insurance is a long term contract and your money and will eventually yield good returns.
Additionally, if you are planning to pay your premium through an intermediary, make sure that they are licensed to collect the money.
Lastly, feel free to ask questions throughout the process of selection and purchase. It is important to understand the fine print of the policy you are planning to buy.
Well, now that you know about the services offered by life insurance companies, are you ready to talk to an agent?