Term insurance plans, in simple words, are affordable insurance plans that provide all-round protection and financial stability to your family in your absence due to any unforeseen event. A term insurance plan comes with basic coverage for a certain period of time. If the insured dies while the policy is active, his/her nominee can receive the death benefits offered under the selected term insurance plan.
A term insurance plan is best known to provide you with the benefits of large life insurance cover at an affordable price. Yes, among all the other life insurance plans, a term plan is a policy that provides you coverage at the lowest premiums. Also, to get additional benefits, you can attach riders such as accidental death benefit, waiver of premium, critical illness cover, etc. to your term insurance plan and get wider protection for your loved ones.
If you are the breadwinner of your family, a term insurance policy can ensure your family’s financial security in case of your untimely demise. While buying a term insurance plan, remember that the cover you get should be equal to 10 to 20 times your annual income. There are various types of term plans like a pure term plan, return of premium plan, and term insurance plan with income benefit. You can choose the one that suits your requirements best.
Here are a few reasons why term insurance is for you.
- Competitive pricing – Term insurance plans are easily comparable on the basis of price. Term insurance policies are similar in terms of structure and operation, allowing you to compare different policies easily.
- Easy to understand – There are many policies offered in the market like endowment policy, etc., but it is hard to understand them. There are several aspects that are part of insurance policy like calculation of risk, death benefit, and repayments of policy. When you compare a term plan to these complex policies, you will realize understanding term insurance is very easy as it only asks you to select the term for which you need to be covered. That’s it.
- Easy Renewal– One of the biggest advantages of choosing a term insurance plan is that it allows you to renew and continue your insurance cover. This saves you from the tedious process of undergoing and submitting various medical tests on completion of your policy.
- Convertible – Term insurance plans come with a feature of convertibility. This feature allows you to convert term insurance into another policy like an endowment policy based on changing conditions. Conversion of a term insurance plan includes a few restrictions like time duration, cost of conversion, amount to be converted, etc.
- Affordable coverage – Term insurance is known for its affordability. A term insurance policy comes at a considerably lower rate of premiums as compared to other policies. Policyholders can decide the amount of monthly premium of the term plan. This can be decided based on the policyholder’s budget and income.