How should I select my insurer?

To make that decision, you have to look at a few parameters in your life insurance company such as:
 

• Brand trust

• Claim processing time

• Claim settlement ratio

• Customer reviews

• Solvency ratio
   

Evaluating these factors before buying a term plan will help you choose the best life insurance company for your needs.

It’s a no-brainer really. You must buy term insurance from a brand you trust, exactly how you buy your smartphones, laptops and other things from brands you trust. 

You must be familiar with this brand and be able to trust them to pay your claim and address all your queries or complaints without any delay so that your family can avert any financial distress in your absence. 

No. The reason is simple.

You don’t want your family to wait for days and months, constantly following up with the insurer to get the life cover, right?  

So, look for an insurer with low claim processing time, because you know they will pay out the insurance money at the earliest. Most insurers boast about a one-day claim settlement. Any insurer with 1 day+ claim processing time is a no-no.

It gives you an indication of how many death claims the life insurance company has approved. 

It is calculated by dividing the total number of claims approved by the insurer by the total number of claims received by them.

This is quite an important factor and the insurers are really competitive about this! The best insurers in the industry have claim settlement ratios in the range of 98-100%.

It's best to opt for an insurer with a claim settlement ratio of 97% and above. You can check this number on the insurer’s website. 

Nothing beats the recommendation and opinion of the people who have been on the same journey before. Online reviews on insurers’ websites and third-party websites make it really easy to understand the company. And of course, word of mouth is also an option! 

Ask your friends and family too, about what they think of the insurer. Look at an overall customer review score of 4 out of 5 or somesuch. 

Pro-tip: While it is good to know what others think, it is important to do your own research objectively. Don’t miss the other parameters mentioned above.

You always want to be sure that in a big downturn event, the insurer is capable of paying the sum assured, right? Well, the solvency ratio answers just that. It is the insurer’s financial capacity to meet its liabilities.

But the interesting part is, you don’t need to worry about your insurer’s solvency ratio. It's something that’s taken care of by the IRDAI.