You might be unsatisfied with your term plan due to various reasons. It is possible that various things can go wrong after you purchase a life insurance policy. However, it does not mean that you have to continue with the term plan.
Here are different steps you can take to get yourself out of the situation.
Five things to do if you are not happy with your life insurance policy
If you are in a situation where you are not happy with the policy, you should take the below-mentioned steps:
- Make the most of your free-look period
When you realize that you have purchased the wrong policy, the first thing you need to do is make the most of your free-look period for life insurance. Insurance companies offer a 15-day period. During this period, you can contact the company and inform them that you want to discontinue the policy. The premium will also be refunded to you after deducting the cost of medical test, risk premium, and stamp duty.
- Exit the term plan
Term insurance plans have a low premium. However, you are not allowed to surrender a life insurance policy. In case you exit the plan, you end up losing the corpus that you paid for in the form of premiums and will not get any death benefit. However, you can exit the plan during the free-look duration to avoid losing any money.
- Get additional life cover
If you think that the sum assured is low, you can invest in an additional life insurance cover. The plan will be over and above the sum assured and the benefits of the current plan. This means you will be able to enjoy comprehensive coverage. You can buy an additional life insurance rider that is suitable as per your coverage requirements.
- Surrender Unit-Linked Insurance Plan (ULIP) and endowment plan
If you want to know how to cancel a life insurance policy, you need to understand that companies offer a policy termination option. You can use the option any time after your policy completes three years. However, you will earn no return if you surrender the policy during the first year itself. The Insurance Regulatory and Development Authority [IRDA] states that if you surrender a policy after five years, you need not pay any costs such as fund management charge and surrender charge.
- Convert (ULIP) and endowment plan into a paid-up plan
Many insurers give you the option to continue a paid-up plan. This means you need not surrender your policy but can discontinue paying premiums and the policy will exist until maturity. The benefit will be proportionate to the premium amount that you have paid.
Your present financial situation is a very important factor when choosing a policy. You need to choose wisely and access the financial needs of your loved ones before you make a decision.