Low Price Insurance for All Age in India 2019
Low Price Term Insurance for All Age Groups in India 2019
It is never too early to start thinking about insurance. Especially when it comes to life insurance, it is best to begin as early as possible,…
Now, you are considering getting insurance, you must have surely heard of term insurance.
So Term insurance plan
Even though it deviates from the conventional life insurance, it is one of the best investment options when it comes to protecting the future of your loved ones.
Let’s take a detailed look at all the aspects of best term insurance policies,.
What is a term insurance policy?
A term insurance policy is a type of life insurance that provides coverage during a fixed period of time. To avail the policy, you have to make periodic premium payments at a fixed rate according to what the policy demands, spanning the period of tenure of the insurance policy.
Since life insurance is all about providing protection for your loved ones and securing their future, term insurance provides you the assurance.
However, in the case of term insurance policies, when the policy period ends, there is no guarantee of the premium rates. You can either choose to extend the policy coverage with new premium rates or forego the policy.
Thinking about getting a term policy? Know the important facts about it.
Before getting any investment it is crucial to know every little detail about it. It doesn’t do well to decide on a policy without deliberation and then have regrets later. That is why it is imperative that you do all the necessary research about the term insurance policy of your choice.
So let’s take an overview of some of the most important factors related to term policy –
- It is a plan with a fixed payment rate for a certain period of time.
- The term policy rate of the premium does not remain unchanged after the expiry of the time period.
- A person can choose to renew the policy after the expiry of the term or can completely forego it.
- In the event of the death of the policyholder during the policy term, the nominee gets to claim the benefits from the policy.
- Usually, a family member can opt to get a lump sum amount or a monthly payment option according to their preference.
- Some term insurance policies also cover disabilities where there is a disruption in the income of the policyholder.
These points explain the basics of the policy. But when is it the right time for you to get the term insurance policy? Let’s find out.
Important features of the term life insurance policies –
Life is unpredictable. That is why it is not wise to assume that no harm can befall you. Therefore, to ensure that your family members don’t suffer financially in your absence, it is wise to make a term insurance policy.
Tax benefits –
These term insurance policies have excellent tax benefits under the Income Tax Act 1961. You become eligible for tax benefits under Section 80C and Section 10(10D). Additionally, you can also claim benefits for the premium of Critical Illness Benefit under Section 80D of the Act.
The flexibility of choice –
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With this policy, you can choose to invest in a single life basis plan or a joint life basis plan. In a single life basis plan, the term insurance policy will cover the death of only one person (generally the breadwinner of the family). In a joint life basis plan, the policy covers the death of two people (for instance, both the husband and wife).
But make sure to read up on what the specific term insurance policy offers. Most policies offer the plan on a first claim basis. That is, on the death of wither the husband or the wife. Some of the term insurance policies offer payment on the death of both the policyholders.
Term of the policy –
For term insurance, the term of the policy can range from 5 years minimum, to a maximum of 25 years to the lifetime of the insured person with monthly premium payments. However, in the case of single term policies, the term can span between 5 to 15 years.
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The insured person has the liberty to choose the term most convenient for them.
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The minimum age of eligibility for this term insurance policy is 18 years while the maximum age is 65 years. With this plan, the premium increases with the age of the insured person. Therefore, to enjoy its maximum benefits, you should consider investing at an early age itself.
Benefits upon survival –
Pure life insurance policies only provide life cover and no survival or maturity benefits. You have to forego of the premium when the period of the policy expires. However, many companies due to the demand of investors have launched survival benefits for the pure life insurance policies as well.
Term Return of Premium (TROP) plan option returns the premium to the investors after the expiry of the term even if they survive. Even though these term insurance plans with survival and other benefits have higher premium rates than pure insurance plans,
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the promise of getting back the premium makes them popular.
Therefore with so many favorable features, the term insurance policy has gained a lot of popularity in a very short period of time.