Online vs Offline Life Insurance

TeamAckoSept 25, 2024

Purchasing life insurance to protect loved ones is a major life decision for everyone. It requires deliberation on the policy's sum assured, premium payment term, and duration. In this regard, comparing and contrasting the advantages of purchasing term insurance online vs offline is worthwhile. Keep in mind that these are merely options for obtaining term life insurance. Let's start with the fundamentals before we get into the pros and cons of purchasing insurance online vs in person.

Contents

• What is Online Life Insurance?
• 6 Advantages of Buying Insurance Online
  • Easy comparisons
  • Hassle-free customer-care centre
  • Better prices
  • Saves time
  • Convenience
  • Quick processing
  • Explore ACKO Life Flexi Term Plan
• What is Offline Life insurance?
• 3 Advantages of Buying Life Insurance Offline
  • Personal Interaction
  • In-depth information
  • Assistance with Claim Process
• Online vs. Offline Insurance: Key Differences
  • Cost
  • Knowledge about insurance policies
  • Challenges of the buying procedure
  • Time Taken for Purchase
  • Availability of Options
  • Transparency
  • Flexibility
  • Premium Rates
• Factors to Consider When Purchasing a Term Plan
  • 1. Coverage Amount
  • 2. Policy Term
  • 3. Premium Payment Options
  • 4. Claim Settlement Ratio
  • 5. Riders/Add-ons
  • 6. Insurer’s Reputation
  • 7. Ease of Process
  • 8. Policy Terms and Conditions
• Frequently Asked Questions

What is Online Life Insurance?

Online life insurance is a process where you can buy a life insurance policy over the internet, i.e. online. This can be done through a website rather than a local insurance agent or regional office. The primary purpose of life insurance is the same as it was back in the beginning—to provide financial security for your loved ones after you pass away.

Buying Life Insurance online bypasses the need for human interaction (through middlemen). The purchase of life insurance online vs. in-person differs in a few key ways. Comparing the pros and cons of purchasing insurance online versus offline might help you find the best policy.

6 Advantages of Buying Insurance Online

Buying insurance online has become increasingly popular due to its convenience and benefits. Here are a few reasons why.

• Easy comparisons

Online platforms offer easy access to a wide array of insurance policies, enabling seamless comparisons.  If you go through an insurance salesperson, they will only sell you a policy from their firm, which means you miss out on this perk.

• Hassle-free customer-care centre

In contrast to agents, who might not be reachable or who might not follow through on their promises, internet insurance providers can be reached at any time and are a "brand," a fully operating firm.

• Better prices

Since there are no middlemen commissions to pay, purchasing a life insurance policy online is often slightly less than buying the same policy offline. Due to lower total expenses, the average sum assured is typically higher when purchasing insurance online.

• Saves time

Life's hectic pace leaves little room for pursuing goals that truly matter. Due to a variety of challenging circumstances, our priorities frequently shift. Many people don't get life insurance because they assume it will take too long to enrol. In this regard, life insurance policies purchased online shine as a viable option. Buying life insurance online is far more efficient than doing it in person because of how easy and quick the process is.

• Convenience

One of the biggest advantages of online life insurance is convenience. You can apply for life insurance from the comfort of your home or office without visiting an insurance agent's office. You can fill out the application form, upload the required documents, and pay online. This saves you a lot of time and effort.

• Quick processing

Online life insurance policies are processed much faster than offline policies. Once you submit your application and the required documents, the insurer will verify the details and approve the policy within a few days. This saves you a lot of time and ensures that you are covered as soon as possible.

Explore ACKO Life Flexi Term Plan

Regarding online life insurance, ACKO Life Flexi Term Plan is a unique plan exclusively designed to protect your loved ones. It is a Pure, Non-Linked term plan with the features to customise your policy coverage and term exactly as you need. With this plan, 

But that's not all – You also have the option to personalise the plan with valuable riders:

• ACKO Life Accidental Death Benefit Rider

• ACKO Life Accidental Total Permanent Disability Benefit Rider

• ACKO Life Critical Illness Benefit Rider 

Find the right plan---> 

What is Offline Life insurance?

Buying a life insurance policy offline involves working with a local insurance agent or going to a company's branch office in person. By going this route, you'll be able to speak with agents who are well-versed in various plans and can help you choose the right one.

When purchasing insurance offline, you can consult with agents who will provide you with all the information you need to make a wise choice. This is a tremendous aid when the policyholder needs to gain knowledge of the insurance industry.

When online was not an option, the only way to obtain term insurance products was in person. This is one reason some consumers prefer to work with a life insurance agent, whether they want to buy, renew, or make a claim.

3 Advantages of Buying Life Insurance Offline

Offline life insurance is the traditional way of buying life insurance by visiting an insurance agent's office. Here are the advantages of offline life insurance.

• Personal Interaction

One of the biggest advantages of offline life insurance is the personal interaction with the insurance agent. The agent can guide you through the entire process, explain the policy features and help you choose the right policy. This personal touch can be comforting and reassuring.

• In-depth information

When you visit an insurance agent's office, you can get in-depth information about the policy and ask any questions you may have. This can help you understand the policy better and make an informed decision.

• Assistance with Claim Process

When you buy offline life insurance, the insurance agent can help you with the claim process in case of an unexpected event. The agent can guide you through the life insurance claim process and the required documents you need to submit

Online vs. Offline Insurance: Key Differences

Many consumers are still determining whether they should buy life insurance online or offline. Here are some deciding factors.

• Cost

If you're concerned about the premium cost of life insurance, you can save money by purchasing life insurance online instead of offline. However, before making your final decision, you should review the policies thoroughly and avoid basing it solely on the cost.

• Knowledge about insurance policies

Some people find it easier to research life insurance online, while others prefer asking a local agent they trust. Since a life insurance plan can be purchased in either of these two ways, buying online or offline depends on how well you understand the product. 

Meeting with an insurance agent face-to-face allows you to ask questions and get personalised advice. Buying online is more self-service, so you need to educate yourself on what policy options exist. Many online providers have customer support teams to answer questions, but the guidance is more general.

• Challenges of the buying procedure

You can acquire a quote online using a calculator, fill out the form by entering the necessary facts, and pay a premium to purchase a policy in minutes rather than hours or days when you buy life insurance offline. The application process is much faster online, usually taking 15 minutes or less to get a quote and apply. Offline can take several meetings with an agent before applying. The medical exam and approval process is similar for both. However, having an agent to contact can be beneficial if any issues come up during underwriting.

• Time Taken for Purchase

Online insurance is generally faster to procure. Documentation can be submitted electronically, and policies are often approved and activated more quickly than offline. The offline purchase process is more time-consuming, requiring physical meetings, paper form submissions, and potentially longer processing times due to manual handling of documents.

• Availability of Options

The internet provides access to a vast array of options. Insurance seekers can easily compare offerings from multiple providers on various aggregators' websites, which helps them make an informed choice. Options for offline purchases are often limited to the products offered by specific agents or agencies. This might restrict the buyer's ability to compare different policies as comprehensively as online.

• Transparency

There's a higher degree of transparency in online transactions, as you can access detailed product information, customer reviews, and terms and conditions at the click of a button. This openness helps build trust and assist customers in making educated decisions. Transparency can vary significantly in offline settings, depending on the agent's integrity and willingness to disclose full information. Sometimes, important details might be glossed over during face-to-face interactions.

• Flexibility

Online platforms often offer more flexibility in terms of policy customisation and adjustments. Changes can be made quickly through user-friendly interfaces. Adjustments to policies through offline channels typically require further appointments and interactions with an agent, which might be more immediate and flexible.

• Premium Rates

Generally, online insurance policies are cheaper than their offline counterparts. The lower cost is due to reduced overheads for the provider, such as no commissions for agents and lesser administrative costs, often passed on to the customers. Premiums tend to be higher when purchasing insurance offline due to the additional costs of human agents and physical paperwork.

Factors to Consider When Purchasing a Term Plan

When considering the purchase of a term insurance plan, it’s vital to approach the decision carefully. Here are some key factors to consider:

1. Coverage Amount

The coverage amount, or sum assured, is the most critical factor of your term plan. It should be ample enough to secure your family’s financial needs in your absence. A good rule of thumb is to select a sum at least 10 to 15 times your annual income. This can help ensure that in the event of an untimely demise, your family can maintain their lifestyle, clear debts, and address future needs like education and retirement.

2. Policy Term

The duration of the term plan should align with your primary financial commitments and life stages. Consider how long your family will depend on your financial support. It might be until your children are self-sufficient or until your mortgage is paid off. Choosing the proper term ensures you are well-insured when it matters most.

3. Premium Payment Options

Different term plans offer various premium payment options—single, regular, or limited. Choose a payment schedule that suits your financial situation. Regular payments (monthly, quarterly, or annually) are often more manageable for consistent income earners, whereas a single premium might be suitable if you prefer to deal with payments all at once.

4. Claim Settlement Ratio

The claim settlement ratio of an insurer indicates the percentage of claims they have settled against the claims received. It serves as a trustworthiness indicator. Higher ratios suggest the insurer is reliable and settles most claims, thus offering peace of mind that your beneficiaries will benefit without hassle.

5. Riders/Add-ons

Consider whether you need additional coverages like critical illness riders, accidental death benefits, or waiver of premium riders. These add-ons enhance your insurance coverage but at an extra cost. Assess each rider's benefits against the added expense to decide if they are worth including in your term plan.

6. Insurer’s Reputation

Research the insurer’s market reputation and financial stability. A company with a strong standing and a robust financial background is preferable as it assures long-term service and reliability.

7. Ease of Process

How simple is buying the policy and the subsequent claim process? In today’s digital age, ease of online access, minimal paperwork, and customer support are essential factors. Look for insurers who provide a seamless online purchase experience and efficient customer service.

8. Policy Terms and Conditions

Before finalising your term plan, carefully read the terms and conditions. Understand the inclusions and exclusions to avoid surprises at the time of a claim. Pay special attention to any clauses that could impact the claim or coverage.

Choosing the right term insurance is about balancing the need for sufficient coverage with the cost of premiums, ensuring your family’s future is secure in a way that fits your current financial landscape. Take the time to assess your needs thoroughly and compare various plans to find the one that fits best.

Frequently Asked Questions

Here are some common questions about online or offline Life Insurance

Is online life insurance reliable?

Yes, online life insurance is reliable. You should choose a reputable insurer and read the policy terms and conditions carefully before buying the policy.

How can I compare different online life insurance policies?

You can visit the insurer's website or a comparison website and compare the policies based on their features, benefits and premiums.

Can I buy offline life insurance online?

Yes, some insurers allow you to buy offline life insurance online. You can visit the insurer's website, fill in the application form and the agent will visit you to complete the process.

What security concerns should I know when buying life insurance online?

When purchasing life insurance online, ensure the website is secure, indicated by a URL starting with "https://" and a padlock symbol in the address bar. Be cautious of providing personal information on platforms that do not have these security measures in place.

What happens if I need to file a claim but purchased my policy online?

Filing a claim with an online policy typically involves submitting the necessary documents through the insurer's online portal or via email. Most online insurers also offer customer support through call centres to guide you through the claim process. 

How can I ensure my family understands the life insurance policy details if I'm not around?

Whether you buy your life insurance policy online or offline, discussing the details with your family or the beneficiaries is important. Keep all related documents in an accessible yet secure place, and consider creating a summary of the policy's key points and procedures for filing a claim.

Disclaimer: The content on this page is generic and shared only for informational and explanatory purposes. It is based on industry experience and several secondary sources on the internet, and is subject to changes. 

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