Have you ever tried to hold a fistful of sand tightly in your hand? Notice how it slips out no matter how firmly you hold your palm closed? It is an allegory for life itself no matter what your current plans, you never know what the future holds! You might have the best laid plans in place, but an unexpected event may topple your plans in an instant. You are justified in worrying about your family's future in your absence. With high living costs and inflation making it difficult to fulfill every need, you wonder what your loved ones will do if you are not there to protect them.
Life is uncertain, but you can certainly plan to mitigate the uncertainty. Protect your family's future with a term insurance policy.
What is term insurance?
Term plans are life insurance products that provide coverage for fixed period of time against the eventuality of death. In case the insured person dies during this fixed period (called as policy term), a death benefit (also referred to as sum assured) is paid out. While the emotional loss of a death cannot be compensated, the financial impact can be minimized through the death benefit proceeds.
In comparison to other categories of Term life insurance, term plans offers a higher Sum Assured of your choice at affordable premiums.So anyone can easily buy an adequate coverage amount at an affordable premium.
Below are some of its salient features :
• They can be designed to provide comprehensive coverage through additional benefits like critical illness riders or increasing Sum Assured. In case of the unfortunate demise of the life assured while the plan is in force, the entire sum assured is paid to the nominee(s). The amount can be used to take care of the family's future needs.
• Since the premiums of a term plan are affordable, it is a suitable option for those who want a life cover at a reasonable premium.
• Term insurance also provides tax benefits on the premium paid.
• Term insurance policies do not have a maturity benefit. If you outlive the plan tenure, you do not get any payout.
Term insurance takes care of the financial future for your family!!
Many people are skeptical about buying term insurance plans because the plan does not have a maturity benefit. If you want a payout at the maturity stage , you can opt for a money back policy or another endowment plan. But term insurance must be considered through the prism of future financial needs it is designed to provide benefits to your family in case of any unfortunate event like death. With the term insurance proceeds, your family can manage the household expenses, apart from major costs of children's education and wedding, urgent medical expenses, etc.
Thus, it is important to realize that term insurance policies are designed to provide peace of mind to the policy holder, knowing that their family is financially secured at all times.
What are the different types of term insurance plans?
There are a few different types of term plans, based on the insurance provider you buy them from. Apart from the traditional pure life term plan, you can invest in protection plans that have a critical illness rider, or income replacement plans, increasing term assurance and premium return plans.
How much life cover do I need?
The factors to consider when buying a term plan are: Your current age, current income and projected rise in income, annual expenditure, future goals, and future inflation. Write down the amount of money needed per year at the moment, and multiply it by 10 – this is the minimum sum assured needed.
Age wise insurance need: Your age plays a role in determining not just the premium amount, but also the future needs of your family. Those in their 30s and 40s, for example, are more focused on family goals for their growing families, while those in their 50s are more focused on spousal and family support. Look up the age wise insurance tabular chart provided by leading insurance companies.