A human life consists of money, love, deception and many other things, but what it’s devoid of, is the assurance of life itself. Therefore, to secure the future of your loved ones, one must invest in term insurance plans.
Everything You Need To Know About Term Insurance Plans in India
Most insurance companies offer term insurance, which fall into the life insurance category. A term insurance coverage includes a specific life term for which a policyholder is covered against death. In case a policyholder dies during the term of the policy, the family of the policyholder receives a sum amount of the policy as a death benefit.
Term Insurance Types –
There are 5 different terms plans existing in the Indian life insurance market.
Pure term plan – Affordable and an easy term plan with pre-determined sum assured.
Return of premium plan – Here, as coverage increases, increases the outlay of the premium. However, attracting, the return of premium is a costly option.
Decreasing plan – Here, the policyholder can see his/her sum assured as the premium keeps decreasing each year.
Increasing plan – Contradicting the decreasing plan, a policyholder getsthe sum assured as well as premium increased every year.
Convertible plans – Here, a policyholder enjoys dual benefits of the plan as well as savings. Here, the premium can be converted into investments.
Guide to select a term insurance –
Buying an insurance can be a worrisome exercise as each plan comes with a set of terms and conditions.
That is why, there are some key features that you need to consider, when buying a plan.
Sum Assured: Sum assured is an Amount your life is covered for by the insurance company. In simple terms, the amount your family will receive in case of eventuality.
Entry Age: Starting insurance policy at the early stage is always advisable, as it provides wider coverage for lesser premium.
Maturity Age: The maturity age plays vital role in deciding the policy. One should choose policy that offer long time protection even after the retirement.
Tenure: Term insurance policy has flexible time span. One should expect term policy to serve long term, like 30 to 40 years – the ideal term plan tenure that reduces premium cost.
Claim Settlement Ratio: You should seek some replies about the claim settlement ratio, claim processing time, and post-claim submission services.
Riders: Insurance documents are long text and not all are talked about by your agent. Hence, going through the rider is important.
Term insurance plans are preferred compared to others because they are easy to understand and easy to fulfill the terms. Term plans bid improved flexibility in terms of sum assured, policy tenure, and premium types. Term Insurance Plan is the cheapest protection plan that comes with great return for you and your family.