There are plenty of insurance companies that offer various term insurance plans. These plans come in different types and forms. The primary objective of any term insurance policy is to offer financial security affordably to the family of the beneficiary in case of the death of the policyholder. In case of accidents and uncertainties, these policies are useful for the insurer’s family. By paying regular premiums, the insurer can derive more benefit from the term plan. You can select any term insurance policies that suit your requirements and your family’s needs.
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What is a Term plan?
Term insurance is a type of life insurance plan that offers financial protection to your family members, in the event of your untimely demise. If you are the sole breadwinner of the family, then term insurance is a must-buy as it safeguards your family’s financial needs in case you are not around. As the name suggests, a term insurance policy offers financial coverage to the insured person for a specific ‘term’ or time period. If the policyholder dies during the term of the policy, then the death benefits will be received by the nominee of the insurance plan. The affordable cost, long coverage period, flexible cash-out options, and tax-saving benefits are some of the significant advantages of buying a term insurance plan.
The different types of term plans:
The basic term plan
It is a simple life insurance policies that offer full life cover for the insurer. The insurance claim is available only at the demise or during the maturity of the term plan. Also, there is no maturity benefit if the insured survives the term period. It is a simple term plan that is valid till the fixed term duration.
The increasing term plan
In the increasing term plan, the sum amount increases every year. It is a plan that is suitable for inflation and deflation effects. With this policy, the insurer will get full life cover that gradually increases through the years till it reaches the maximum amount.
The decreasing term plan
In the decreasing term plan, the sum amount keeps decreasing during the end of the policy period. It is a type of policy that is suitable to cover the loan and repay debts. At the time of the demise of the insurer, the amount gets directed to the repayment of loans.
Term plan with premium returns
The term plan with premium returns is beneficial as the entire premium paid is returned to the insurer during expiry. This term plan offers you full life coverage.
The benefits of choosing the term plans
There are uncountable benefits of choosing a term plan. When looking for a term plan, consider the solvency ratio, claim settlement ratio, and rider benefits before making a purchase. All these factors are essential to experience maximum benefit from the term plan. Some of the benefits of choosing the term plans are as follows.
Affordable premiums
With affordable premiums starting from INR 15/-, the term plan is the most cost-efficient policy to choose from. Easy savings and easy cashout options also make it a preferable insurance policy. If you are willing to pay high premiums, then there are excellent life coverage periods available under the term plan.
Financial security
The idea behind a term plan is to provide financial security to the family of the insurer. At the time of the demise of the policyholder, the family can receive a lump sum of money. It offers financial support to pay loans, debts, and education fees among other things.
Tax-saving benefits
Under Section 80C, the number of premiums paid for term plans is exemptible. After the demise of the insurer, the family receives death and tax benefits.
Coverage plans for illnesses
There are specific illnesses listed under the policy for which an assured sum is available to the insurer. If the insurer is suffering from any of the listed critical illnesses, he/she gets the assured sum for the treatment. The benefit rider is a scheme under this term plan that provides claims for serious illnesses such as cancer, tumor, blindness, kidney failure, and more.
Safety coverage for accidents
The term plans assure a safe future for your family members. If the insurer passes away, the family receives the death benefit.
Flexible premium payment options
The best thing about choosing a term plan is simple payment options. You can select any of the premium payment options. There are monthly, quarterly, and yearly payment options available for the insurer.
Conclusion
The term insurance policies are the most simple, affordable, and effective insurance policy in the market right now. It is easy to avail of a term plan and experience the extraordinary benefits.
