17 Sep, 2021 | Term Life Insurance

Buying Insurance Online Vs. Buying Insurance From A Credible Financial Advisor

Team Beshak
By Team Beshak
We breathe insurance :)
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Introduction

Everything today has become digital and the reasons are obvious - buying stuff online is quick, easy, convenient and you get a lot of discounts. It is possible to do almost everything and anything online - shopping, paying bills, ordering food. Even consulting the doctor. 

But think about this. Would you really feel confident getting a diagnosis online, knowing that the doctor hasn’t physically seen or examined you? While we might want to avoid the trip for minor ailments - would you be okay getting major diagnoses, long-term treatments online? 

The situation is very similar when you look to buy insurance. Much like a long-term medical treatment, an insurance purchase could have implications on you and your family’s financial health for your entire life. And before you decide which mode is right for you, you must compare both the options, weigh in the pros and cons and then pick the option that gives you the most peace of mind. 

So, let’s get right into it and compare!

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Prefer watching a video? We got you covered! 

Comparing buying term insurance Online Vs. Offline

Convenience

How easy is it to find the right policy for yourself, and actually buy it? This is a factor that often impacts your overall experience while buying an insurance plan. So, how does buying term insurance online vs offline, or any other type of insurance policy,  compare in terms of convenience? 

Online purchase: Buying insurance online is quick and simple - you can compare and purchase a plan within minutes, from the comfort of your home. Most insurance companies allow you to make your purchase through their online portal, and all your form submission, documentation, etc. happens through their portal itself. 

One thing you must keep in mind - the buying process online is quite simple, the processes after that are not. You may have to fill out a separate, more trickier proposal form after you make the payment, follow up with the insurer to get your policy, etc. And you’ll need someone to help you with all this. In case of online purchase, the support will be from a call centre and you’ll have to be very lucky to be able to get a good advisor who’ll provide proper assistance.

Offline purchase: All this can be avoided if you’re buying the policy through a good financial advisor. The financial advisor will manage everything for you - they will help you during the purchase, visit the branch office, bring you the form to be filled, gather the documentation at your end and submit them, and also follow up with the insurer on your behalf so your policy gets issued on time. 

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Cost and discounts

There could be a difference in costs - mainly through discounts and special offers, based on where you purchase the policy. So, what differences should you expect between offline and online purchases?

Online purchase: When you purchase a policy online - through an aggregator or the insurer’s website, you’ll most likely get huge discounts on your premium amounts. This is actually one of the most popular USPs that online portals advertise while selling plans and you can check out the many offers you get online.

Offline purchase: When you purchase the policy offline by yourself or through a financial advisor, however, you will not get any discounts or offers. You’ll have to pay the costs of premiums set by the insurance company.  

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Sales & Advice: The Conflict of interest

The insurance business runs on commissions. Whether it is an online portal, an aggregator, or an offline agent - everyone earns a commission based on the sale they make. In fact, they get commissions not just when they make a sale, but every time you renew the policy too. 

But how do these commissions impact the quality of service you get? Do they make the service better like they’re supposed to, or worse?

Online purchase: On online platforms, you’re most likely interacting with a team that is trained only in selling and is heavily incentivized for selling products that are better for the company (and not essentially for you). The person on the other end of the line has no reason to know you or your family. So, they are likely focused only on increasing their commissions, and not on building a relationship with you.

Further, once a purchase is made, your case moves from the ‘sales’ team to the ‘service’ team and so, you are likely to never speak to the person who sold you your policy again. 

Offline purchase: When you purchase an insurance policy offline through a financial advisor, you are interacting with the person who will be the face of the company, a representative for all your needs. Sure, even their income depends on the commissions they make. But since you know them personally - it is a matter of reputation for them. 

And a good advisor knows that building a reputation is more important than a slightly higher commission. So, they are more inclined to provide good advice and earn your goodwill. Further, they also know that if you trust them, you will recommend them to your family and friends - and that’s a sure shot way of building their business. 

Moreover, if you are buying from a financial advisor on Beshak, the plan recommendations are powered by Beshak research, which assures the advice you are getting is 100% unbiased, and free from any conflict, whatsoever. 

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Spamming and chasing

When it comes to selling the insurance policy, is there excessive calling, spam and chasing during both online and offline purchases? Or are there any differences? Let’s find out.

Online purchase: One of the most frowned upon annoyances of the online insurance experience is that you keep getting back-to-back calls, as soon as you enter your number. In fact, most insurance companies don’t even generate a quote before getting a valid phone number (OTP checking). And once this happens, they will not stop calling you. 

Portals as well, are notorious for excessive calling and spamming. If you block one number, they will call you from another. If you show your annoyance to one person, you’ll get a call from another. And this cycle can get tedious!

Offline purchase: As discussed above, the offline business relies heavily on goodwill, word-of-mouth publicity, and reputation building. A good financial advisor would want to ensure you are happy - that is their first priority. This is true for Beshak curated advisors too. Financial advisors listed on our website will never spam or chase you with calls or messages. They will genuinely be interested in building a good relationship with you and your family and inclined to provide good service and earn your goodwill. 

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Claims assistance

At the time of claim, you or your family might need help with documentation, filling up the claim form, following up with the insurer, and other things. Hence, it’s very important that you have a good advisor by your side who’ll help you with all these things and ensure that the claim is processed smoothly. 

How do online and offline purchases compare in terms of providing assistance at the time of claim settlement?

Online Purchase: Unfortunately, most of the claims process across insurance companies is still offline. Although some insurers offer online claims services, forms and documents will still be needed to submit to the branch office. 

Things have changed slightly with Covid19 and the fear of paper transactions. But, in a majority of cases, you or your family will still need to interact with the branch office to get the claim processed. You will most likely not get any help from the online seller, who sold the policy in the first place. 

Offline Purchase: As mentioned above, a good financial advisor will be on your side throughout your insurance journey during purchase as well as during claim settlement. They can act as the single point of contact between you and the insurance company and follow up on your behalf to get the claim approved. If you’re buying from a Beshak-verified advisor, you and your family are guaranteed to receive personalized support at the time of claim settlement. They will ensure that you receive your claim quickly and smoothly - and if needed, even fight on your behalf to ensure the claim amount comes through. 

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Remember - the insurance journey is a long one, and can span many decades. And purchasing the policy is just the first of the many steps. While buying online may be easy, timesaving and cheap, it is less likely that you’ll receive personalised guidance or assurance during and after policy purchase. Yes, you get a 5-10% rebate on the cost, but there are disadvantages that come along too. 

On the other hand, a financial advisor cannot give you a discount, but is more likely to be on your side to find a good fit as well as stay in touch with you and your family throughout the process, from purchase to claim. Not all financial advisors will guarantee great service. Only buying from committed financial advisors with an established track record for service and claims assistance should be preferred.

Whether you buy your insurance plan online or offline, you must be aware that they come with their own pros and cons. Only after assessing all these factors, can you actually make a well-informed decision on where you buy the policy from!

How do you find the advisor?

If you face any issues during or after buying the policy, you’ll need a knowledgeable person on your side, to help you make sense of your situation and solve them quickly. Whether online or offline, you’ll need this representative who will help you navigate the complex world of insurance. But, how do you find your advisor - in online purchases and offline? 

Online purchase: The seller or advisor that you’ll find online is essentially appointed by the system. They’re picked by the computer - meaning the assignment is rather random. So, it largely depends on luck- whether you get the right, wrong, good, or bad advice. Further, once your purchase is made, this person will not be accountable for the rest of the experience. Your case moves to the service team, and you’ll be assigned another person, randomly again. Again, you’ve to be lucky to find a good person to assist you. 

In fact, every time you call the toll-free, there might be a different person handling your case. And you’ll need to be lucky every single time to get a good advisor. The whole experience relies on the system.

Offline purchase: In an offline purchase, however, you pick your advisor. You can take references from friends, or family, or from social media, essentially people who have already used their services, and base your decision on this. Or you can choose from among India’s top 5% financial advisors we’ve listed on our website here. We’ve curated advisors from around the country who will guide you, help you make informed decisions, and be by your side throughout your insurance journey - right from purchase to renewals to claims.

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How to find a financial advisor you can trust?

This also means that the responsibility of due diligence lies with you. Remember, insurance is a promise to deliver in the future, which is why you need someone knowledgeable and experienced to handhold you when the time comes. You have to make sure you have proper references and find a good advisor to help you in the long-term. In fact, we would say that you should spend as much time to find the right advisor, as you would to find the right plan. Because, it is just as important, if not more!

We’ve vetted top financial advisors from around the country and listed their profiles on the Beshak Community Connect page. You can go through them, check their track record, and choose an advisor who you think will be right for you. 

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Here are few tests that could help you identify a good, long term financial advisor:

  1. They will think about protection/risk first, and investments later.
  2. They will understand your needs well, before recommending solutions. 
  3. They will recommend solutions (in the form of products), not simply share brochures, PDFs, or material with you immediately in the first meeting. 
  4. They will have a track record of excellent service, beyond sales. 
  5. They will own the experience, and will be known for fighting it out with insurers to ensure that you get a good experience.

Key things to look at if you are forced to buy online:

  1. Ensure you do a detailed study before you sign up. Read the policy wording document, read blogs, ask questions on forums, like the Beshak Forum. Understand the benefits, limits, exclusions well. 
  2. If you’re buying term insurance, use scientific tools like Beshak TruMatch that will recommend plans along with which features you must pick, which you must skip - so your policy is designed perfectly as per your needs.
  3. Always fill the proposal form yourself - do not depend on any sales representative. From our experience, we are sure that they’ll miss out on important details - which you’ll have to deal with later.
  4. Check the premium breakup before you make the payment. 
  5. Ensure you track the case diligently, until the policy document is issued. 
  6. Check the policy document to see if it matches what you have paid for. You can return a policy within 30 days of receipt, if bought online. 
  7. Ensure that you have shared all details about the policy with your family.

Got a question about insurance? Post it on the Beshak Insurance Forum and get responses from insurance experts!

Key takeaways
  1. You can compare and purchase an insurance policy online within minutes, from the comfort of your home, as opposed to buying offline where it might be a little time consuming.
  2. Online purchases often offer discounts on the premium, which might not be available when you buy through an advisor. 
  3. Whether you’re buying online or offline, the sale will be driven by commissions. However, an advisor needs to build their reputation - and hence, will be less likely to sell you a bad product, just for the sake of a commission. 
  4. Most insurance claims processes today are offline. Even if you buy the plan and pay premiums online, your family will need to get in touch with the branch office to get their claim amount. Having a financial advisor to guide them will help smoothen this process and give them a better claims experience. 
  5. Whether or not you get a good and knowledgeable advisor online depends largely on your luck as the system will appoint them. In an offline purchase, however, you pick your advisor. You can take references from friends, or family, or choose from among India’s top 5% financial advisors we’ve listed on our website.
  6. A good financial advisor will understand your needs well, before recommending plans. They will not simply share brochures, PDFs, or material with you immediately in the first meeting and have a track record of excellent service, beyond sales. 
Team Beshak
Written by,
Team Beshak, We breathe insurance :)

We are a group of young members of the Beshak community. We come together to brainstorm, write relevant and useful content for people (just like us) who want to figure insurance on their own. If you too want to share inputs/write for us - send us a "hey" to info@beshak.org

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