Life insurance plans provide a risk cover against death on the life of the policyholder during the policy term. Thus, if the policyholder were to succumb to an untimely death during the policy term, the insurance provider will pay a death benefit to the nominee. The death benefit, in most cases, will be equal to the sum assured opted for by the policyholder at the time of purchasing the policy with the addition of any bonuses that may be payable under a plan. Thus, life insurance plans are a must if you want to ensure that your dependents are financially secure in case of an untimely eventuality.
That being said, life insurance plans also have certain exclusions. If the policyholder has passed away due to an event that is mentioned in the insurance provider’s exclusion criteria, no death benefit will be paid to the nominee. Thus, it is necessary to familiarise yourself with the policy’s terms and conditions, inclusions, and exclusions before purchasing a plan.
*Note: This is a general list of exclusions and is not exhaustive. The exclusions mentioned above need not be applicable to all life insurance policies.
Life insurance policies usually provide coverage for events that are unintentional, accidental, or unplanned. Thus, if you have a life insurance policy, you should first make sure to read through the exclusions mentioned in the policy brochure in order to know the limits of your policy’s coverage. Also, make sure to keep your policy in force by paying the due premium as per your premium payment schedule, since this will ensure that your policy doesn’t lapse and stop providing you coverage. Lastly, it is vital that you take your nominee through the claims process and inform them about the exclusions and inclusions of the policy in order to ensure that they don’t face any undue hassles when filing the claim.
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