Lapsing is the last thing you want to happen to your life insurance policy. It puts you out of insurance coverage and if something unfortunate happens to you, your family could be left without financial protection.
What is lapsing?
In insurance, lapsing means your insurance is no longer valid. Lapsing mainly occurs when you don’t pay your insurance premium on time.
In a case of lapsed insurance, your family members can’t claim for the insured amount, if something unfortunate happens to you.
This makes it extremely important to keep your insurance policy up to date. Here are a few points that can help you in ensuring your term insurance never lapses –
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Remembering to pay on time- The best thing you can do to keep your insurance policy from lapsing is the most obvious one- by remembering to pay on time. You could set up auto-reminders, you could set up an email reminder or even take the help of the insurance company to remind you.
Also, you shouldn’t postpone your payment at any cost. Sometimes, we neglect insurance policies and their reminders, especially if we are going through a financial crunch. This could seem alright, but life could be extremely volatile, and you wouldn’t want to leave your family’s safety to chance.
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Setting up auto debit options- Auto debit options help you never miss a term insurance payment by automatically debiting your payment amount from your bank account or credit card. All major insurance providers have this option.
This can be done by setting up a standing instruction with your bank. The process is usually very simple and can be done online.
Some insurance providers will let you pay for insurance using auto-debit from your credit card also. For this, visit your insurance provider website or contact your insurer’s customer care and they will help you set things up.
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Keeping your details up to date – Making sure your details, including your communication address, email address, and phone number, are up to date with your insurance provider will help you in two ways.
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It can make sure you don’t miss any payment reminders – Most often, insurance companies will try to contact you near to your insurance’s payment date to make sure you pay. If you change your phone number, email, or address and don’t inform your insurance provider, you will miss these communications. This might make you forget the insurance payment date.
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It makes claiming your insurance easier – Up to date information makes claiming insurance much easier. You or your family member might face challenges if your address is not up to date. It could delay the amount disbursal also.
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Making sure you can afford your premiums – When you buy an insurance plan, you should be very careful in choosing the premium amount. Having a high insured sum is great, but it could prove to be useless if you can’t honour the insurance payments. Making sure to set a premium that you can afford becomes very important here. This way, even if the sum is a bit less, you can make sure you are insured, and your family is financially protected.
If you are having a hard time figuring out insurance numbers, take the help of a term insurance calculator. This will help you choose what is right for you.
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Making sure you don’t miss any communication from the insurer – A lot of people will just ignore emails and messages from the insurance company thinking it might be an advertisement. But sometimes, these emails can carry very critical information like a payment reminder or a policy change. Thus, it is always advisable to make sure you read all communication from your insurer properly.
What to do if your term life insurance has lapsed?
In case if your term insurance has lapsed, it is important that you get it sorted as quickly as you can. A lot of people tend to buy another term insurance policy, but it could be better for you to just reinstate your current policy. Reinstatement is easier as you don’t need to go through the paperwork once more. If your policy has lapsed, don’t waste your time- call your insurance provider and they will help you sort things out in no time!
