Credit cards are considered revolutionary financial products which have completely changed the financial landscape. The ease of payment and carrying the mode of payment has replaced the hard plastic cash in most of the countries for mostly transactions. With the introduction of credit cards in the 1950s, it has become indispensable for most people.
A credit card has made people’s life much easier since it came into existence. In the modern world, credit cards even help to pay your insurance premiums. Get your life insurance with no medical exam, where you don’t need to sit for any life health insurance exam. You need to know how term life insurance without a medical exam works to leverage its benefits, and with credit cards, you can pay premiums easily.
The customers can not only purchase products using the credit card, it can also be used to repay the bills at a later date, there are numerous advantages associated with it such as discounts, airmiles, reward points. It is also helpful in repaying the utility bills and payments along with your insurance premiums very easily, without any hassle.
With the high popularity of insurance plans, many people are buying the insurance plans due to economic instability, unpredictable markets, and various reasons which are lucrative and compelling. This way, individuals can easily manage their finances for their family and unwanted situations. There are various companies which provide life insurance policies with various benefits especially payment methods as per the convenience of the customers.
Though there are different methods of paying insurance premium payments like auto-debt, internet banking, debit card and credit cards. The significance of credit cards in an average individual’s life has increased, giving the most preference for insurance premium payments. But, it has both the advantages and disadvantages, which need to be managed by knowledge and understanding.
How To Pay Insurance Premium Via Credit Cards?
Paying for insurance through credit card is very convenient for individuals and the premium amount gets automatically deducted from the account. Many insurance providers provide the option of auto-debit which makes the payment easy and hassle free. Thus, the auto-debit option becomes an exceedingly simplified option for many customers. This way, customers never fall behind or miss the premium payment as it gets reduced automatically timely.
Moreover, many times it gets problematic that customers wish to switch their insurance provider, or they may try to switch to the best credit card provider. For this, there should be full convincing by the policyholder about the card and the payment method that the individual wishes to pay for insurance. Also, doing so will help you improve your credit score in the long run, and the credit score check needs to be done timely.
Advantages of Using Credit Card For Insurance Payments
- The biggest advantage for customers paying insurance premiums through credit card is that the bank balance doesn’t get affected when the payment is made. The delayed cash flow makes it easy for the individuals to manage finances for expenses and insurance payments at the same time. If the individual becomes unable to process the payments immediately for any reason, covering this up through a credit card can provide enough time for managing the expenses. Moreover, the customers need to pay up the bill in their next billing cycle without any delay, otherwise it may hamper their credit score.
- Also, we talked about the receiving of reward points and other perks for using credit cards for the insurance premium payments. For example, when you pay your life insurance premium using your credit card, you can easily rack up some reward points of benefits like discounts on holiday plans or travel tickets. For this, you need to pay the insurance premium in a lump sum amount or you can pay monthly dues to receive the bonus points or offers by the card providers.
- Many customers are unaware but using credit cards can actually add to your credit score and help you improve your credit portfolio. This can be useful in the long run, improving your loaning chances based on the early credit card payments. Therefore, you need to make a wise financial decision of using a credit card for insurance payments which is usually wise if handled with proper planning of repayment.
Mistakes To Avoid For Using Credit Cards For Insurance Payments
You must acknowledge various points for paying insurance payments using credit cards, as it can get tricky easily. Definitely, you can delay your payment outflow for earning credit card points, but you need to be careful for not making the mistakes like these:
- Auto-premium Deduction
Once you set your premium deduction on auto-mode for your credit card, every month at that time the premium amount will get deducted, irrespective of your choice. So, before making such an option you must be sure of the remaining money through proper expense planning of the month.
- Confirm the Additional Charges
Many insurance providers may charge you extra for paying through the credit cards, though some insurers don’t do so. It may vary from policy to policy or insurer to insurer. Therefore, you must be aware of the additional charges levied for the same. If the charges are exorbitant, avoid doing so.
- Never Miss Deadlines
You need to pay your insurance premium on time, but credit card payment is also important for timely payments. Eventually, one way or the other this creates credit card debt. Eventually, one way or the other this creates debt on your credit card.
Final Thoughts
With this article you can easily understand insurance premium payments using credit cards, credit score check their benefits, and mistakes to avoid while doing so. You must read the insurance terms and conditions carefully, accepting the one which favors credit card payment mode without any extra charges.
Author’s Bio:
Abhishek Kumar is your common gigital Hooman with marketing as profession, finance as a curious habit, and sports as a survival mechanism. He has written this post for IndiaLends, leading website for Personal Loans in India.
