How to change your insurance payment frequency?

  • Life Insurance

Pranav purchased a life insurance policy 4 years back. At the time of purchase, he had opted to pay the life insurance premium for his policy as annual payments. The policy offered a life cover of Rs. 50 lakhs, and Pranav had to pay an annual premium of Rs. 1,20,000 for the same. Initially, Pranav paid his dues promptly. However, as time went on, he got married and had children, and quickly, he found that his monthly expenses increased.

Each year, as his policy anniversary came closer, he was finding it very hard to save up the Rs. 1,20,000 needed to pay the premium. Any amount he managed to save up for 3 to 4 months was eventually spent on some emergency expense - like his children’s medical costs or their school trips. So, this year, he decided to surrender his policy.

Do you think this was a good decision? Well, on the surface, it may seem like Pranav made a good choice. After all, he will now have the extra Rs. 1,20,000 to take care of his family’s expenses, isn’t it? But what if 7 years from now, Pranav suffers from an unexpected accident and passes away? Without a life cover, what will his young family do to survive?

You may try and justify Pranav’s decision to surrender the policy because it seems like he had no other choice. But in fact, he did have an easy way out - he could have simply changed premium payment frequency to something more convenient.

Wait a minute. What is the premium payment frequency though? And how to change the premium payment frequency? Let’s find out.

The meaning of premium payment frequency

Also often referred to as the insurance payment frequency, the premium payment frequency indicates the interval at which the policyholder pays the premium to the insurer. Often, many insurance companies also refer to it as the mode of premium. You may already be aware that for some life insurance policies, you can pay the entire premium upfront, as a single lump sum payment. In such cases, there is no insurance payment frequency, because you do not pay regular premiums.

In all other cases, these are the different premium payment frequency options available:

  1. Annual payments:

    Here, you pay your premium 1 time each year
  2. Half-yearly payments:

    Here, you pay your premium 2 times each year
  3. Quarterly payments:

    Here, you pay your premium 4 times each year
  4. Monthly payments:

    Here, you pay your premium 12 times each year

Some plans offer all these insurance payment frequency options. For example, the ABSLI Vision MoneyBack Plus Plan is a savings plan that offers all these four options. Other plans may offer only a few of these options. So, before you purchase your life insurance plan, make sure that you look for words like ‘premium frequency’ or ‘premium mode’ in the policy’s brochure. This way, you can check out the options you have before making your purchase.

There is no right or wrong insurance payment frequency. What may be comfortable for you may not be comfortable for another policyholder. The good news is that you can always change your premium payment frequency.

How to change the premium payment frequency?

Generally, most insurers give policyholders the option to change the insurance payment frequency. However, keep in mind that you can only do this on the policy anniversary date. This date is when the policy is due for renewal, and usually, every year, it falls on the same date the policy was issued.

So, for example, say you have a policy with the policy anniversary being August 31, 2021. But on June 13, 2021, you decide that you want to change the policy’s premium frequency. In this case, the change will come into effect only from the policy anniversary date, which is August 31, 2021. Till then, your old payment frequency will continue to be valid.

Now, let’s see how to change the premium payment frequency. Keep in mind that these steps may vary from one insurer to the next. This is just a general guide to help you make this change online.

  1. Visit your insurer’s website and log into the portal if you need to.
  2. Find the customer service section and enter the details needed. These details may include your phone number or email ID, your date of birth, or your policy number,
  3. Once you enter these details, select the new premium payment frequency that you want.
  4. Select/enter the date from which this change will be effective. As we saw earlier, this will typically be the next policy anniversary.
  5. Submit this request along with any other details or documents that are needed.
  6. Once the change in payment frequency is confirmed, your insurer will communicate this with you.

If you hold a life insurance policy with Aditya Birla Sun Life Insurance, you can visit this page to get started with the frequency change application. 

Last words

So, this sums up the answer to the common question  - How to change the premium payment frequency? As you can see, the process is fairly simple. Make sure that you contact your insurer before you do this though, so you can get a clear idea of the exact process to follow. Also, when you change your insurance payment frequency, the premium amount may also undergo a small change. Make sure you check this detail and plan your payments accordingly.

ABSLI Vision MoneyBack Plus Plan (UIN: 109N093V04) is a traditional participating life insurance plan.

ADV/5/21-22/196

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