Online vs Offline Term Plans: Which is a Better Option?


Since the onset of the COVID-19 pandemic, every individual has thought about what would happen to their family or loved ones if something unfortunate happened to them. Many individuals have realized that an easy way to safeguard the future of their loved ones in their absence is through term insurance plans. These insurance plans provide the policyholder’s beneficiaries with financial assistance if they meet their untimely demise. One can purchase the best term policy plan once they know their family’s financial requirements and plan accordingly.

How do People Choose a Term Plan?

When considering life insurance plans, one can look at the wide range of options that flood the Indian insurance market. Generally, life insurance policy buyers look at two features when purchasing the plan:

  • High risk coverage
  • Affordable premiums

One type of insurance that fits both the criteria is the term insurance plan. These are pure protection insurance plans to purchase a term insurance plan – online and offline. For years, Indian citizens have been purchasing affordable term life insurance through the traditional offline mode with the help of an insurance agent.

However, with the whole world relying heavily on the internet for all their needs, insurance providers have begun providing their insurance products on their websites. While both the methods of purchasing the plan are suitable, let’s see how different factors affect the online and offline mode of purchasing a good term insurance plan.

Factors affecting online and offline purchase of insurance policies:

  1. Transparency:

When it comes to applying for a term plan online, the customer can fill in all the details themselves, whereas, in an offline plan, the customer has to rely on the insurance agent to complete the form correctly. This can be a bit risky as the agent may make any errors when filling the form. If there are any inconsistencies on the application form, the insurance company may reject any claims filed in the future.

Even while filling the form online, provide accurate and correct information. Providing accurate information on your insurance form is one step closer to ensuring that your beneficiaries do not face a roadblock while filing a claim.

  1. Costs:

Online term insurance plans are somewhat cheaper than offline options since the individual deals directly with the insurer without any mediator or agent. Agents provide offline insurance policies, and the agent’s commission is an added expense to the purchase of the term plan.

  1. Sum assured:

Online term insurance plans provide a sum assured starting from ₹5 lakhs at affordable premiums. Since it is easier to calculate term insurance premiums online with a term insurance calculator, people can adjust the sum assured with the premiums and vice versa.

With offline plans, the calculation of the premiums becomes a little more tedious and often, people end up choosing a lower and insufficient sum assured to avoid paying higher premiums.

  1. Claim settlement ratio:

When purchasing term insurance plans online, you can easily learn about the insurer’s claim settlement ratio. Your insurer’s claim settlement ratio plays an important role when the beneficiaries file for a claim, as this factor reveals how many claims the insurer has successfully settled so far.

An insurance agent may withhold such information out of bias while helping you purchase an offline term plan.

  1. Flexibility:

The process of buying the term insurance plan online is quite simple and quick. You only need a laptop or mobile device with a decent internet connection that lets you visit your preferred insurer’s website. You can go online, evaluate all the policies available, opt for the most suitable one, make the premium payment, and the process of buying the policy is over.

However, when purchasing a term plan offline, you will have to meet your insurance agent a few times to clear the paperwork – something that is not required in the online process.

While getting a term insurance policy, one can choose if they want to buy an online term plan or go for the offline alternative. While both the options are open to individuals, the online mode is always quicker and more convenient.

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