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When the person is young and unmarried, he can purchase term life insurance or just a basic life insurance cover. And later, after the marriage and children, his financial needs and priorities change and he may require altogether a different life insurance plan. In this case, he needs to update or increase the term insurance cover.
Similarly, there are many more cases when the person needs to increase the insurance cover. The process of adding an extra cover to the existing life insurance Policy is easy but only if the person knows appropriate steps. In this article, we are going to discuss how one can add an extra cover to the insurance policy.
But before that, let us delve into “what is life insurance” and “how can you analyze the amount of that extra insurance cover”.
Life insurance is a protection plan for those who are Dependants on you when you will not be around. It is a resource pool for them to carry on with their life as usual till the time they themselves become self dependent.
This resource pool or sum Insured is the amount decided by you that you want your dependants to rely upon. When you want to increase your insurance cover, you need to calculate the sum insured as per your present situation. To do this, add up all the expenses your dependents will be required to do without you, the way you did it while procuring your life insurance policy. Now, subtract your previous sum insured amount from the above calculated sum insured.
When you arrive at the figure to be increased, do look into your budget whether you will be able to pay increased Premium for the same and decide your sum insured, accordingly.
Now, you need to contact your agent or your insurance company to tell them that you want to procure extra insurance cover. You will be asked to fill certain forms and sign the documents ascertaining the same.
Other than this, if you do not want additional coverage from the same insurer, you may get life insurance from a different carrier. However, this will demand for detailed information regarding other policies you possess, your present financial and health scenario and you have to pay yet another amount of premium as well. Buying life insurance again from a different Insurer may appeal to you but you have to be prepared for that in depth as you will be investigated comprehensively and you have to be careful that the information given is absolutely true and correct. But before choosing your insurer go for thorough research, compare life insurance rates and choose the best life insurance in terms of low premium rate and maximum coverage.
Our financial needs keep on changing with time and our providers of life insurance in India are aware about this. So, they grant us with the facility of enhancing or decreasing the coverage. Still, you on your side must ascertain this fact about life insurance policy and obtain it only if it is feasible to you.