Term Insurance: Online vs Offline

You can get yourself insured through the help of an agent, which is considered offline mode, or by yourself on your computer, that is the online way. A lot of people worry and are unconvinced that the online route is the way to go due to the security and reliability concerns, however, it is gaining popularity among youth at a very rapid pace.

Term Insurance is the type of policy that is taken for a fixed term and the premium payment will be paid for that term only. In case of any mishap occurs in that time frame, all the compensations will be provided. The combination of low premium and high reimbursement makes the best term insurance policy a must-have for every household. As we are moving forward in getting everything accessible online, insurance plans are also now getting the online presence and eventually costs less as there is no mediator or agent involved.

A Little More About Term Insurance

It is a form of a life cover but is payable only to the fixed term for which the policy is taken. In case of the death of the policyholder in that specified time, their nominee will get the cover amount. The actual purpose that these plans serve is to provide a layer of security provided by you in case something happens to you. It will provide a specific amount of cover for a very specific period.

The debate on online vs offline term insurance plan is started and the majority of people are still dubious about shifting towards the online process.

Some Basic Perks of Online & Offline

There are advantages to both the purchase options. Some are discussed below.

Online Term Insurance Plan

To our generation that wants everything to be available online on our fingertips, whether it is getting a ride or buying a perfume, all can be done by just a single tap in a mobile app, it’s a natural inference that the online insurance is getting popular rapidly.

Some Advantages of Online Term Plans Are

To our generation that wants everything to be available online on our fingertips, whether it is getting a ride or buying a perfume, all can be done by just a single tap in a mobile app, it’s a natural inference that the online insurance is getting popular rapidly.

1. Many Options:

   Getting an insurance policy for yourself may be one of the most confusing tasks you ever encountered. When you go for the online route, there are many aggregators present who are providing you all the policies from every term insurance company, and by this, it couldn’t be made easier for you to compare and get one for you. This option is not available in the offline route.

2. Getting Things Done From A Brand:

   When you are purchasing a policy for yourself through an online app, you are dealing directly with a well-established brand that can not and will not lie about the policy terms or will not hide any important or general fact. On the other hand, when you are dealing with an agent, he may be doing such things for his gain. This is a huge plus point to be discussed when it comes to an argument for online vs offline term insurance plan.

3. Zero Fraud:

   All of the company’s terms & conditions are listed on the app and you can go through them in detail and can decide for yourself if it’s worth getting this policy or not. You are also allowed to take the printouts of those T&Cs for your documentation and record-keeping. This transparency hugely diminishes the risks of fraud or any hiding of the facts. Whereas it is just the opposite case when you are getting a policy through an agent. As agents work for any particular company, not as aggregators, the risk and probability of those agents may try to manipulate the facts and terms and present you in a way that you instantly like them and decide on getting the policy is very high. These manipulated facts may influence you and help the company selling one more policy by misrepresentation of the facts.

4. Less Cost:

   As there is absolutely no mediator or any agent involved, the overall cost of getting a term insurance policy for yourself drops down a lot. This eliminates all the intermediary costs and commissions that an agent is entitled to get from the company, which you have to pay in the form of a hiked processing fee. Online insurance policy will cost you around 30-70% cheaper than that of an offline one.

5. Settlement Ratio Is Higher:

   The option of providing a settlement ratio is provided by the online aggregators. This helps a lot in deciding about getting a policy from that particular company or not. The settlement ratio is the ratio that provides you the figure of the company’s reputation in getting the claims settled as much as possible. The higher the ratio, the better the process of settlement of that particular company. As these ratios are based on actual customer reviews and feedback, there is no chance in its manipulation.

   Whereas when you are going through an agent, it’s all up to him/her that if he/she is telling you the truth about the settlement ratio, there is no other way in getting to know that from any other source.

6. Flexible:

   In the contest between online vs offline term insurance plans, it is found that the online ones are more flexible and provide a better range of options. With no agents available, you have to do all the research and find the policy facts all by yourself. It should not be seen as a tiresome task because you now have the opportunity of going through all the terms and benefits of the policy all by yourself.

   Whereas in an offline way, you leave all the things to the agent and he fulfills all the formalities all by himself on your behalf. There are some cases seen where a little error by the agent in filling up the details at the time of application costs a lot to the customer in the settlement of the claims. In the online route, as you have to fill the details all by yourself, you will take extra care.

Term Insurance Companies

Check and compare plans from 21 IRDAI-approved term insurance providers before purchasing a term plan.

Offline Term Insurance Plan

There are not only disadvantages but many advantages as well in getting the term insurance plan via the offline route. Some advantages are discussed below:

1. Higher Value:

   The insurance companies may just make some clickbait titles of assuring higher amounts to attract more customers in the benefit of getting a higher sum as the settlement claim. It is seen in many cases that the company claimed the insurance cover of ₹1 crore at just a premium amount of ₹500/month. These higher claimed cover amounts attract a lot of customers even when they don’t need such plans. At these times, getting the insurance policy through an offline mode makes more sense.

2. Benefits Like Illness Coverage:

   The online insurance plans only cover casualties like accidents or death coverage only when you pay an extra amount along with the premium. These plans also do not cover any choleric illness or any benefits for those who are permanently disabled. This is not the case for any of the offline insurance policy. This turned out to be a huge benefit for those who found themselves stuck in the dilemma ofonline vs offline term insurance plan.

3. No Hassle Faced By You:

   When you are opting for the offline route, the agent you will get all the things done for you and you will not have to go through any legal formalities or the tiresome documentation needed for the completion of the application process. However, it could be considered as a disadvantage too as discussed earlier in this post.

Which Is The Better One: How To Decide?

There may be a situation when you are not able to decide whether to go online or offline. While checking the policies online, if you face any confusion, there is always a toll-free number provided by the company to where you can call and talk to a customer representative and clear all of your doubts and confusion.

This will provide you a better perspective along with a clear view so that you can decide for yourself and take a more informed decision. However, there are some mistakes that most people do while going to get the term insurance plan online and for your awareness, some of them are listed below.

Opted For Online: Try To Avoid These!

For attractive convenient factors, like low overall cost, no mediator, etc., online insurance policies are gaining popularity very rapidly. This mode also requires minimal paperwork and the whole application process can be completed in one sitting, hence a lot faster. All you have to know is how the internet works and you are done. As we all know, there are way too many online frauds are going on, so before deciding on one, you must take care of some mistakes which an amateur usually does.

1. Poor Research:

   You should not just base your whole research on only the two factors that we discussed above, i.e., settlement ratio and premium amount. People think all the other factors remain the same in all the policies, which is a huge blunder. You should check the policy details from different sources and must not rely on only one source of all the details from where you are getting your policy. This factor plays a huge role in influencing people to get offline route when they are confused in an online or offline term insurance plan.

2. Get Attracted To Huge Cover:

   The very reason for which the online insurance policies are getting in the mainstream is because of their low premium plans. This feature is used by the companies to attract the customer by claiming huge covers. This turns into customers paying a larger sum than they need. This wastage of your hard-earned money will not happen if you do your research thoroughly and already calculated the actual cover amount you need.

3. Filling Inaccurate Information:

   As you don’t have anyone to guide you about filling up the details, you may end up giving inaccurate information by thinking that it doesn’t matter. However, this thinking will take you nowhere but you will end up paying a lot more at the time of settlement. When you are getting an insurance plan, all the details, be it as minor as possible, matters a lot more than you could ever think of. So, always try to fill all the details very correctly if you want your settlement to be done easily.

Wrapping Up

One thing that you must look for while getting an insurance policy is don’t go for a way too short term, as it will not serve any purpose and your premium will kind of wasted. For example, if the policy you took ceases when you age 45, and at the time of application, your age was 38, there is no point in this investment. The premium amount is directly proportional to your age, as you age, the premium will keep going up. It is recommended that you must sign up for any online or offline term insurance plan at an early age, so you can reap the benefits of that plan.

You must know that giving the details in the most honest way possible, even if it translates to a bit higher premium amount. As it will then cover those illnesses as well and you will not have to worry about any of those expenses. There are hundreds of trusted aggregators available online who will help you in sorting out all of your problems regarding insurance applications.