Tips to choose most suitable insurance product

India is a developing country. People have a general idea about Insurance thus majority is unaware of the importance of having an insurance policy.

Firstly, Insurance is important for everyone. Even the Indian Government has planned a postal rural insurance scheme in addition to the many other schemes they are running.

Few Benefits of Insurance:
1. It brings peace of mind as you and your family members are protected.
2. With investment linked policies, insurance becomes a tool to manage future expenses.
3. Medical insurance is a sure cure for any unforeseen medical expenses on account of an illness or an accident.
4. When Insurance is selected as a retirement investment option, it becomes tool for wealth accumulation for retirement.

Questions to be asked while choosing an insurance policy:
Q1. What is the purpose of insurance?
- The possible answers are: Pure risk cover or Investment tool. Based on your of answer you can determine the type of insurance you need.

Q2. How much insurance I need?
- The answer would vary from person to person. You can use various on-line calculators to arrive at your insurance amount.

Q3. Which insurer should I go for?
- Check the references and not advice of salesmen. Compare the quotes, facilities, options to select the best insurance company for you.

While taking an insurance policy you should consider existing policies and the type of policy if this is not your first. Also you should remember your monthly budget, monthly expenses and approximate insurance premium amount as well.
When insurance is taken as an investment tool, it should take into account the future expenses such as buying home, child birth, child education, marriage etc. The term (duration) and type of the policy are affected by insurance need. The term should be flexible enough allowing you to withdraw the money at required time. In case of fund requirement about long term, you may opt for equity linked investment as historically, equity has always given higher return than fixed income.
As mentioned above, one should also compare premium and the coverage of multiple options. There are new insurance plans available in the market which allows customers to buy insurance policies on-line.
After considering all the above mentioned factors, one should take an informed decision by selecting a good insurance company which offers the best insurance plans suiting your individual needs and providing for your entire family as well.