An insurance quote is essentially the estimated cost the insurance company provides for a policy. The quote helps intending policy buyers understand the cost of purchasing life insurance coverage from the insurance provider. Typically, insurance providers ask for different policy quotes to compare the cost and coverage. Life insurance quotes are known to weigh into account the intending policy buyer’s level of risk and their desired coverage. However, the actual quote typically depends on the insurance providers’ pricing model and accompanying benefits.
Read along to know more about insurance quotes and their use.
Importance Of Life Insurance Quote
Asking for quotes from insurance companies is considered to be a risk-free means to compare policies without making any commitment to purchase them. However, to compare the quotes successfully individuals must provide the same detail to every insurer.
This is important as providing different sets of information to different policy providers could result in varying quotations. Needless to say, it will not allow effective comparison of different policy quotes.
However, it is important to note that life insurance quotes are not essentially a contract and so they cannot be used as proof of insurance. Additionally, the actual coverage, cost of insurance, and terms and conditions are not necessarily final until they are reviewed by an underwriter.
Only after the quote is reviewed an insurance contract is presented to the insurance buyer along with the final coverage, cost of the policy, and terms and conditions. However, the final decision of whether one would accept the insurance price and terms remains with the policy buyer.
Things Included In An Insurance Quote
While an insurance quote offers insight into the potential cost of a policy, it also entails other key details of the policy and the insured. Notably, different insurance policies tend to include different information. For example, the quotes for life, health, home, or auto insurance will feature different details.
For Life Insurance
A quote for a life insurance policy includes –
- Coverage limit
- Term limit (for a term insurance policy)
For Home Insurance
Here are the key components of a home insurance policy quote –
- Financial quote
- Medical payment
- Personal liability
- Cost of living
Additionally, it includes the estimate of:
- Personal property
- House
- Additional structures on the property
Auto Insurance Policy
Besides the policy cover amount, the auto insurance policy quote features:
- Personal information of drivers included in the policy
- Description of the fleet of vehicles included in the policy
- Categories and cover limits, including cover for deductibles, bodily injury, property damage, rental car reimbursement, towing information, uninsured riders, personal injury, and driving out of the country
Health Insurance
A health insurance quote helps understand which costs would be paid by the policyholder.
The quote includes details such as –
- Deductibles
- Out-of-pocket cost
- Monthly policy premium
Typically, this insurance quote features a policy detail and applicable coverage. The information also helps understand whether or not you would qualify for tax returns or not.
Steps to Avail an Insurance Quote
You can avail of an insurance policy quote in these ways –
- Directly from an insurer
- Through phone or online
Which Information Is Needed To Get An Insurance Quote?
When an individual applies for a policy quote they need to provide these details
- Gender
- Date of birth
- Pin code
- Contact details
- Proof of identity
- Contact details
Applicants also have to submit information that is specific to their chosen insurance policy. For instance,
- Pre-existing health issues
- The habit of smoking, drinking, and tobacco
- Outstanding loans
- Outstanding home mortgage
- Car model
- Year of home insurance
- Home address
- Home acreage
Besides this, insurance companies can ask you to submit other relevant personal information and the same may vary from provider to provider.
How Can The Insurance Quotes Help You?
As a prospective insurance policy buyer you can use the information you find on the quotes for similar coverage to compare which policy would be a great financial fit for you. However, to ensure you get an accurate quote, make sure to check all the details you provide.
Individuals are however recommended to check other key details of an insurance policy to ensure they purchase the best-suited policy for their needs.
For instance, check these key features in detail to understand what you can expect from the policy –
- Coverage amount: The sum assured the beneficiary of the policy is likely to receive in the event of the occurrence of the insured event. Typically, a higher coverage amount is deemed suitable to ensure the financial security of the policyholder’s family.
- Minimum waiting period: Typically, health insurance policies come with a waiting period before which the insured cannot raise a claim. This is why opting for an insurance policy with a short waiting period is deemed wise to ensure they have access to financial assistance in case of a medical emergency.
- Rider benefits: These are add-ons that provide extra protection to the insured by expanding their coverage. Notably, adding riders to an existing policy will also inflate its premium.
- Exclusions: Reading the terms and conditions related to insurance claims is crucial to understand more about the limitations of the claim and the overall process. Having an idea about the exclusions helps to create emergency provisions for the same so that the insured has an avenue to turn to in case of need.
- Claim settlement ratio: This ratio indicates the ability of the insurance provider to settle claims. It offers an idea about the percentage of claims the company has settled in a year out of the total claim request.
Only after you have checked these, make sure to compare the policy premium. Individuals also have the option to use an insurance premium calculator to determine the cost of getting a policy.
Hence, a life insurance quote can help you estimate the cost of a policy you plan to get. One can refer to different quotes from policy providers to decide which can suit them the most. They should also consider comparing policy features and reviews to gain an idea about which insurance policy is effective and most suited for the insured’s needs.
