What is a term insurance plan: Importance & Key Features

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What Is Term Insurance?

Term insurance is a life insurance plan which provides financial coverage to the beneficiary of the insured individual for a certain period of time. In the event of the death of the policyholder over the term of the policy, the beneficiary may demand death claims from the insurance company. The death benefit is payable to the applicant or beneficiary who is usually a member of the family. You can choose to get a total or a combination of flat rate and monthly depending on your needs. Some insurance companies also cover a permanent or partial disability in which the regular income of the insured person is abandoned.

Note: If the insured person survives, the cover for the previous premium rate is not guaranteed after expiry of the policy. The buyer must receive extended coverage with different payment terms or completely waive coverage.What is a term insurance plan: Importance & Key Features

Why Should You Buy Term Insurance?

Do not be short-sighted. Get long-term insurance and secure the future of your family. Save your harassment by insuring it financially in a long-term plan. In the event of an unforeseen situation who will deal with your responsibilities? Here the importance of term insurance is felt. The lumpsum that your family receives in the event of your death can bring financial stability and pay debts. This is the real support your family can have if something happens to you. Term insurance is important for all and especially for family builders.

Advantages of the Term Insurance Plan

  • In case of sudden death, receive a total amount
  • Show all your loans and responsibilities
  • Offer money to your family to continue living with pride
  • The conceptual insurance also covers the family in case of disability or serious illness:
  • Provides additional income in case of loss of income due to invalidity or accidental illness
  • Get a full amount when a critical illness is diagnosed
  • Additional insured amount in case of accidental death

Long-Term Insurance Plans in India

Aegon Life iTerm Insurance Plan 18/65 years 80 years Rs.25 lakh 95.30%
Bajaj Allianz iSecure OnlineTerm Plan 18/60 years 70 years 2.5 lakh 91.30%
Canara HSBC OBC eSmart Term Plan 18/70 years 75 years 25 lakh 92.99%
ICICI Pru iProtect Smart Term Plan 18/65 years 75 years Subject to Minimum Premium 96.20%
Kotak Preferred Term Plan 18/65 years 75 years 25 lakh 94.08%
LIC eTerm Plan 18/60 years 75 years 25 lacs 98.19%
Max Life Super Term Plan 18/60 years 75 years 25 lacs 96.23%
PNB MetLife Mera Term Plan 18/65 years 75 years 10 lakh 92.90%
SBI Life eShield Term Insurance Plan 18/65 years 70 years 20 lakh 95.70%

 

Premium payment method:

  • Single
  • Regularly
  • Annually
  • Semi-annually
  • Quarterly
  • Monthly

Term insurance provides flexible plan options to meet the needs of each individual. You can choose:

  • Amount of the insurance amount
  • Premium payment option, which can be punctual or regular
  • Duration of policy
  • Add protection

Key Features of Term Life Insurance Plans

Term insurance plans are specifically designed to ensure the basic financial needs of your family in case of death or uncertainty. Depending on the plan, the families / members of the insured life can claim the insured life and the duration of the insurance policy for a total amount in case of death or serious illness, if desired. Such an insurance plan can help your family have a healthy financial independence even if you are not there.

Tax Advantages

Life insurance plans have excellent tax advantages. They can be deducted from lucrative tax benefits under Section 80C in addition to Section 10 (10D) of the Income-Tax Act of 1961 under Section 80D.

Note: Tax benefits are subject to changes in tax legislation. Contact your tax advisor for further details.

Term of Office

The minimum duration is 5 years and the maximum varies between 25 years and the total useful life of the corresponding monthly payments. In the case of a one-time payment policy, the maturity of the term is 5 to 15 years. People can look for the term period they think will work for them. Experts suggest for a long term plan because the premium amount is usually blocked and the insured must pay the same premium during the long term plan for the same amount of coverage.

Survival Advantages

A standard length plan has no survival advantages. However, the demand of investors has allowed several companies to choose insurance plans with survival advantages. When the premium plan (TROP) is returned, the duration plan returns the premium at the end of the appointment if the insured survives the period. The TROP plan is popular with people who are looking for savings and insurance with their long-term plan. This Term Life Plan has a premium that is larger than the standard term plan but has the advantage that the policyholder returns the premium he paid to cover the life insurance company. Investors should carefully read the terms and conditions of insurance to make sure they know the amount of money they receive as a survivors benefits. Look at the term insurance plan that meets your needs with our comparison of term plans.

Death

In the case of the death, the candidate or legal successor, if the policy has been assigned to another person, receives the total payment of the death rate at the time of the commencement. Depending on the nature of the plan, the death benefit may remain the same for the entire duration of the plan (standardized term plans), decrease (decreasing term plans) or increase (long-term plans). Insurers offer several payment options for the term plan. These include a lump sum payment, a lump sum payment plus a monthly, quarterly or annual pension or simply annuities distributed over the agreed number of years.

Additional Benefits

Additional optional benefits are also available, such as critical illness and accidental death / disability. The benefits would be added to the term plan by paying a further premium amount. The best schedule in India is to offer these riders at a comparatively lower price than to opt for this coverage through individual plans. Some common terms insurance are:

  • Serious disease
  • Full and permanent invalidity recipient
  • Beneficiary of accidental death

To select the best long-term insurance plan you need to ensure yourself by analyzing the following points:

  • Reliability of the company
  • Expenses
  • Convenience
  • Improved reporting
  • Claim settlement ratio
  • Solvency ratio

SUMMARY

This article is for all people who are confuse in judging their decisions carefully on the basis of the past performance of the insurers assessed according to the ratio of their claims settlement. In addition to this age, the health and income of the individual is of great importance, because depending on whether the insurer alone decides the insurance sum, the premium, etc., the list I have provided you will be sufficient to choose the best insurance for long-term.

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