An online quote for a term plan takes roughly 2 minutes. Yet most applicants may face delays at the application stage for several reasons: either they can't find an old prescription, or maybe their income doesn't justify the desired cover.
So, does that mean you shouldn’t buy a term plan online? Of course not, but you need to know the basics and prepare the right set of declarations and documents for an evaluation by the insurer. The pre-screening questions to buy a term plan online are the same as buying the policy offline. However, the digital method gives you an edge with less paperwork, faster submission, and easy tracking.
In the next few minutes, you’ll learn how to buy a term plan online, from getting a quote to policy issuance.
Step 1: Gather your paperwork before filling out the form
Start by deciding on three things: how much cover you need, how long you need it for, and how much premium you can comfortably afford to pay each year. Be careful, as insurance application forms often have values pre-filled, and it is easy to end up with the insurer’s defaults instead of your own figures.
Next come the documents. Most insurers ask for identity proof, address, age, and income. If you’re a salaried person, recent payslips may be accepted as income proof, depending on the insurer’s requirements. If you are self-employed, you will need to furnish your tax returns or other financial records. The exact list varies by insurer.
It’s good to know: Before you buy an online term plan, ensure all your documents have the same name and date of birth. If the spelling differs between your PAN card and Aadhaar, get the discrepancy corrected before the insurer flags it. Also, avoid using your office email address in the online application form, as a term plan can last for decades, and it is unlikely you will have the same employer throughout (especially for private sector employees). The same goes for your phone number.
Step 2: Analyse the quoted premium
An online term insurance quote is based on the information you enter and the assumptions used by the insurer’s quoting system. Check the life cover, the age the cover ends at, how often you pay, how long you pay for, and whether any add-ons were pre-selected. Sometimes a low starting price is calculated for an age, health profile, or cover option other than yours.
Besides, most term plan quotes are for the first year only and can come with a discount. Find out what you’ll need to pay from year two onward. If you see an optional benefit checked, make sure you actually need it.
Step 3: Read before you submit the online term plan application
The information you provide forms the basis of the insurer's decision on your term insurance application. Even if an advisor fills the form on your behalf, take time to read every question yourself. Complete the medical history details, current medications, occupation, declaration of tobacco use (if any), and insurance information wherever the form asks.
Most people go wrong with answering the questions. Say you took a pill for high blood pressure only for a month and your numbers are fine. So, any question about possible hypertension as a diagnosed condition should be marked as a "no" unless it is a prolonged condition (like more than a year).
Step 4: Finish verification and any medical tests
After you submit your term insurance application online, the insurer’s underwriting team may request additional documents, a phone call to confirm information, or some medical tests. What you are asked for depends on the coverage amount, the product, the insurer’s underwriting rules, and your profile.
Next, keep an eye on your inbox. One unread email asking for a clearer copy of an income document may be why an application is pending. If a request seems weird, don't answer it. Check it by calling the number listed on the insurer’s official site.
Keep in mind: If you are asked to undergo a medical test, read the instructions the day before, not that morning. You may have been asked to fast or to bring previous reports. Send documents only through the insurer’s authorised channel and keep the acknowledgment.
Step 5: Read the offer and check when the cover starts
The insurer may accept your application as it is, request more information, offer different terms, defer its decision, or reject it. The revised terms could mean a different premium or a different amount of cover. Just because you paid the first premium and filled out the form doesn't mean you're covered yet. Verify the policy status and the date of commencement for risk cover.
Pro Tip: Keep the application number, payment acknowledgment, and emails together in one folder. If this policy replaces a previous policy, do not cancel the previous policy yet. Wait until the coverage has started with the new policy.
Step 6. Use the first 30 days wisely to read the policy terms and conditions
When you get your term policy, take time to go through the details, such as cover amount, premium schedule, selected benefits and exclusions, and nominee. The Customer Information Sheet offers a good summary, but don’t skip reading the complete policy wording.
Under the IRDAI’s framework, life policies with a term of at least one year come with a 30-day free look period, starting from the day you receive the policy document. You can request cancellation within the 30 days if you are not satisfied with any term or condition of the particular policy. Note that a small percentage will be deducted as admin and other charges before the refund is issued.
If you spot a mistake, drop an email to the customer care team and keep a copy of the response.
Step 7: Ensure the policy is accessible
Always keep your policy in a safe place and let your nominee know where it is and how to contact your insurer to make a claim. Above all, keep your contact and nomination information current. Once a year, ask yourself if the cover still fits your needs, especially if there’s a new milestone, like the birth of a child or you take a new home loan.
Closing Thoughts
So, you see, when buying online term insurance, the insurer decides based on the documents you provide and the answers you give in the proposal form. Furnish the right details, and you can help the insurer assess your application accurately, although approval is not guaranteed.
