Eventually, he would not be required to pay a higher premium.Though the difference in the premium amount seems to be minimal but it proves quite beneficial in the long run.Let’s look at some advantages of backdating insurance policy.Backdating provides you the option of paying lower premium by altering the policy start date and selecting the one which gives you better premium rates.In such a case, the policyholder can pay the premiums for the current financial year at one go, whereas, for the coming year he can deposit the premiums on the due date, set by his insurer.Many of us believe in purchasing important things on significant days like birthday, wedding anniversary and so forth.In such a scenario, if an individual incidentally of accidently buys his policy in his off season then he can get the policy backdated to the period of his maximum earnings.
This will ensure that you don’t end up paying a higher backdating interest.
May-June, December-January), so he can get the policy he bought in his off season, backdated to some date in the aforementioned vacation season.
Who does not love to get return of investment at the earliest? In case of money-back plans, if you backdate the start date of the policy then you are sure to get your first tranche earlier.
Take for example, if you purchase a money-back plan today then your expected 20% of sum assured will be offered to you after 5 years i.e. In contrast, if you backdate the policy to 2013, then your first return will reach you in 2018.
Backdating directly affects the premium rate; hence it should be opted by people who are planning to purchase a policy at an older age.