Top Reasons to Buy Term Insurance
Insurance plans are of the utmost importance when it comes to dealing with serious losses such as death or critical illnesses. These are the events in an individual's life, where any kind of insurance proves to be most beneficial. Insurance plans provide financial assistance and support to the family during difficult times.
With various prevailing plans in the market, insurance offers different options. One of the simplest insurance plans is the TERM PLAN.
What exactly is a Term Insurance Plan?
A term insurance plan, in general, is a low-cost insurance plan, that offers absolute protection and major financial strength to the family in case of unforeseen events occurring with the policyholder. It is availed for a specific duration, for example, a term period of 10 years, 20 years, or 30 years. During these years, it provides coverage to the policyholder under any unfortunate events that occur within those years.
Thus, term insurance is one of the most important financial tools that help your family to survive in case of any mishap that occurs with you. It helps your family to go through the household expenses, education plans, debts and other important life events. You need term insurance to secure your family's future.
Here are the top 3 reasons for you to buy a term insurance plan :
- Term insurance is a financial cover that looks after your family even after you are gone
- Term Insurance helps your family to deal with debt and have a peaceful life after you
- Term Insurance is an important financial instrument that helps you to save taxes
Top Benefits of Term Insurance
Benefits of term insurance are many. The most prominent benefit is the financial security to the family after the death of the policyholder. Apart from that, you must know the entire list of benefits before you buy a suitable term insurance plan.
Here, we are going to discuss some of the top benefits you and your family will get if you hold a Term Insurance Policy :
- Offers Financial Security to the Family : If the policyholder is the only earning member of the family, then after his death, the total amount that comes to the family as the benefit of policy can help to sustain the daily life without facing any financial challenges.
- Helps in Loans Repayment and Debt Handlings : The term Insurance lump-sum amount is a great tool to pay the loans. This amount, which the family receives after the death of the policyholder, can be used to make the family debt-free. This greatly reduces the financial liability on the family's head.
- Offers Tax Benefits : As per the section 80C and 10(10D) of the Income Tax Act, you do not have to pay any tax on the maturity amount and premium payments for your term insurance, respectively.
- Helps with Important Life Expenses : The term insurance money also helps to take care of some important expenses such as higher education and marriages of the children. This helps the family to build future life.
- Income Stability in Case the Policy Holder is Disabled : In case the policyholder is disabled due to an accident or a critical illness and there is a loss of income, the term plan can also provide a supplementary income for the family to run a smooth life.
- It is the Most Affordable Insurance Plan : With so many benefits and absolute financial security to the family, the term plan remains the most affordable term insurance policy for the entire family. Buying the term plan at a younger age is always helpful as it comes with lower premiums and higher benefits.
If the policyholder is the only earning member of the family, then after his death, the total amount that comes to the family as the benefit of policy can help to sustain the daily life without facing any financial challenges.
The term Insurance lump-sum amount is a great tool to pay the loans. This amount, which the family receives after the death of the policyholder, can be used to make the family debt-free. This greatly reduces the financial liability on the family's head.
As per the section 80C and 10(10D) of the Income Tax Act, you do not have to pay any tax on the maturity amount and premium payments for your term insurance, respectively.
The term insurance money also helps to take care of some important expenses such as higher education and marriages of the children. This helps the family to build future life.
In case the policyholder is disabled due to an accident or a critical illness and there is a loss of income, the term plan can also provide a supplementary income for the family to run a smooth life.
With so many benefits and absolute financial security to the family, the term plan remains the most affordable term insurance policy for the entire family. Buying the term plan at a younger age is always helpful as it comes with lower premiums and higher benefits.
Other benefits :
- Term insurance helps to achieve long-term goals
- It also supplements retirement goals
- Some term plans help take care of business too
- It is a tool for systematic savings
- It buys you a lot of peace of mind
At Cover 360 you can compare a range of term plans offered by various insurance providers and buy the most suitable plan as per your individual needs, at just a few clicks.
Types of term insurance
Term plans come in various forms to cater to different needs of the customers. Here some basic types of term plans for your understanding.
- Pure Term Plan
Pure term plan is the most basic kind of term insurance policy. You can buy it as your regular insurance policy. You will be required to pay the stipulated premium for the entire term of the policy. The plan helps the family of the policyholder. The entire sum insured is given to the family in case the policyholder dies within the term of the policy.
- Return of Premium Plan
If you want to gain some extra returns on your term plan, you can opt for this policy. This policy helps to get back all the premiums paid if the term of the policy is over and the policyholder is still alive. When this entire sum is received as a lump-sum amount, it helps to cover many expenses.
- Decreasing Term Insurance
In this life insurance policy, the sum assured keeps decreasing with every passing year. Hence, the premium paid on this plan is very low. People usually buy this plan to take care of their debts. As the years pass and the policyholder remains alive, he keeps pays off his debts from his regular income, the need for sum assured keeps decreasing too. If the policyholder dies during the term, the insurance money can be used to pay off the debts.
- Increasing Term Insurance
As the name suggests, this plan is the opposite of the decreasing term plan. In this one, the sum assured keeps increasing every year. People usually buy this term plan to meet future expenses such as children's marriage, and higher education etc.
- Convertible Plan
You can convert your basic term plan into a whole life term plan or an endowment plan if you buy a convertible policy. You can do this only if you have spent a stipulated time within your basic policy (pure term plan). The option of a convertible plan is very good if you wish to make good investments for good returns in future.
Invest in the best-suited term insurance plan as per your individual needs! Check out all the plans at Cover360.
Included and excluded cover in term insurance
Term insurance plans are carefully designed to provide meaningful financial cover to the family in the event of the death of the policyholder. But, there are certain exclusions in term insurance that are important to understand.
On this page, you are going to read about the included and excluded cover in term insurance.
Types of Deaths Covered and Not Covered by Term Insurance :
- Covered – If the Policy Holder Dies a Natural Death or Due to Health Issues
The natural death or caused by health-related issues is covered by term life insurance plans.
- Covered – If the Policy Holder Dies in an Accident
One of the inclusions in term insurance is that it also provides coverage in case of death of the insured due to an accident.
- Partially Covered (Non-linked Plan) - Death by Suicide in First 12 Months
In case the insured commits suicide during the initial 12 months from the date of policy commencement, the beneficiary is eligible to receive 80% of the premium paid if the policy is a non-linked one.
- Fully Covered (Linked Plan) – Death by Suicide in First 12 Months
If the policyholder commits suicide during the initial 12 months from the date of policy commencement, the beneficiary of the policy receives 100% of the total premium paid if it is a linked life insurance plan.
- Not Covered – Accidental Death Due to Consumption of Alcohol or Drugs
If the policyholder dies under the influence of alcohol or any type of drug while driving or due to involvement in any type of criminal activities the claim is rejected.
- Not Covered – Death Due to Intoxication
If the policyholder dies due to overdoes of drugs or alcohol, then the insurance company will not provide any death benefit to the beneficiary.
- Not Covered – Death in an Event Related to Adventure Sports Life insurance plans exclude the cover if an individual dies while participating in adventure sports like skydiving, parachuting, rafting, bungee jumping, etc.
- Not Covered – Death by Self-Inflicted Injuries
In case the policyholder dies due to the injuries that he/she has given to self for example cutting self with a blade or jumping from height, the claim made by the beneficiary is rejected.
- Not Covered – Death Due to HIV/AIDS
If the insured dies due to any type of sexually transmitted diseases like HIV or AIDS the insurance company will not accept the claim.
- Not Covered – Death Due to Murder :
In case the policyholder is murdered by the nominee and the investigation reveals their involvement in the crime, the insurance company will reject the claim.
- Not Covered – Death Due to Natural Disasters
If the policyholder dies due to a natural disaster like a flood, a forest fire, a storm or a tsunami, the insurance company will not provide any coverage until and unless the insured has opted for any rider benefit for the same.
Factors that affect premium for term plan
You can always compare various insurance plans to find out the best suited and land at the lowest premium for term insurance. But, you must also know and understand various factors that affect the premium for a term plan.
Here are those:
||How it Affects
||The younger you are; the lower will be the premium simply because young people are less likely to die.
||Women are charged lower premiums as compared to men. Women, on an average, live 5 years more than men do, which means that the insurance company gets premiums for a longer period, hence, the lower premium.
||Policy buyers suffering from ailments like diabetes or cancer are charged a higher premium. Any past diseases or surgeries, potential ailment developing in present, and the overall health record are taken into account while calculating the premium.
||Medical History of the Family
||Family history of genetic disorders leads to higher premiums. If term insurance policy buyer's father, mother or anybody in immediate blood relation died of a genetic disease, they will be charged a higher premium.
||Obese or highly overweight people are charged a higher premium for term plan as they are on high risk of health disorders like diabetes, blood pressure, heart ailments, joint complications, and many more.
||Smokers are considered to be extremely risky customers and sometimes have to pay twice the premium as compared to a non-smoker.
||Consumption of alcohol or pathological drinking also leads to a substantial increase in premium.
||Other Lifestyle Choices
||If one is involved in adventure sports, driving fast cars, partaking in risky activities, they will have to pay higher premiums.
||Type of Term Plan
||If one is buying a life insurance cover for a long term and will be paying the premiums for a longer duration, they will be charged a lower premium. However, if one buys a short-term plan, it will increase the premium amount.
||Type of Profession
||Risky professions like mining, working in oil and gas industry, fisheries and other such dangerous professions, lead to higher premiums.
Important things to consider before buying term insurance
You must buy term insurance with proper planning and considerations because it is a lifetime plan. You should know your expectations from term insurance clearly and find a suitable plan accordingly. It may sound like a difficult task to select the perfect plan, but if you consider these points and make your research according to this, you can find the most suited plan that offers maximum insurance benefits at reasonable premium amount.
Here are the things you must consider before buying a term insurance plan :
- Establish the Cover Amount
You must know your financial needs and the amount your family would need to fulfil them even after you are gone. This will help you to establish the amount insured and to search for the right plan.
- Determine the Policy Period
This is important depending on your age. The years that you will be paying the premium must be the years you are working. This helps to pay the premium comfortably and decide the insurance timeline.
- Buy as Soon as Possible
You must buy the term insurance at a young age. This ensures that you are paying a lower premium because, in younger years, the health is at the peak, hence, the premiums are low.
- Be Honest with the Insurer
At the time of filling insurance the proposal form, you must disclose all your medical history and current conditions (if any) else your claim could be rejected. Inaccurate information goes against you.
- Avail the Rider Benefits
If you do not want the basic term insurance plan, you can check out the riders (additional benefits on extra premium) and buy the riders that suit your financial goals. Extra coverage is always good to make the best insurance plan.
- Compare the Insurance Companies and Their Policies
It is extremely important to compare term insurance policies and the offerings of different companies to find out the best insurance plan. The top features to compare are goodwill, premium amount, claim settlement ratio and sum assured. Select the right insurance company based on this comparison.
Benefits of comparing term plans
Buying a term insurance policy is a very important decision of life! It should not be taken carelessly.
With a huge number of insurance providers present in the market and many options available on term insurance, it becomes important that you must compare insurance policies available and then buy the best which suits yours and your family’s needs.
Here are some clear benefits of comparing term plans :
- Find the Cheapest Plan with Best Benefits: To buy the cheapest term insurance plan, which comes with various additional benefits, you must compare the cost of additional benefits offered by different insurance companies.
- Understand the Important Features : To find out the prominent features (USPs) of different policies, it is important you must know all the features that are available with different insurance providers.
- Know the Terms and Conditions of Different Insurance Companies : To understand the terms and conditions of the insurance policies and companies in detail, you must compare the insurance plans smartly.
- Insurance Claim Settlement Without Any Problem : To get easy and hassle-free settlements of insurance claims you must know the background of the insurer by comparing the claim settlement ratios of various insurance providers.
- Know the Most Professional Insurer for You : To find out the financial standing and market reputation of different insurance providers and to know whether they adhere to IRDAI (Insurance Regulatory and Development Authority of India) regulations or not, you must compare policies.
- Design the Best Plan for You : To create a customized term insurance plan, which is tailor-made for you, comparing different policies and their benefits is a must.
Do not rely on insurance agents! Compare life insurance policies yourself at Cover 360 before buying. You must get the best.
Term insurance claim process
Term Insurance claim process is very simple. If you wish to know how to claim term insurance, you must read this.
Here are the steps you need to follow to get a term insurance claim through with the insurance provider.
- As soon as it happens, inform the insurance company about the death of the policyholder. You can look for the contact details on the website of the company or the term policy documents that you received.
- Fill the claim form provided by the insurance provider. Make sure you provide all the required details clearly.
- Submit the form to the insurance office along with the original policy documents and death certificate of the policyholder.
- The insurance company will start the process of surveys and background checks. If everything is appropriate, you will receive the insured amount in 3 to 4 months of filing the claim.
While you file the term insurance claim, here are a few important things to remember :
- The insurance company will send you the claim form along with the policy documents. If you have not received one at the time of death, you can ask for one.
- Every company has their own process and formalities to follow. Please read the policy document carefully before filing the claims.
- The lump-sum amount that you receive as the sum insured is tax-free. You do not have to pay any tax on that, as per section 10(10D) of the tax department.
- The insurance company will run a detailed survey and background check before approving your claim. This may take a few months.
- The sum insured is settled through a cheque or online transfer.
Make sure you check the insurance provider's background and claim settlement ratios thoroughly before you buy a term plan.
Why is it important to renew your term insurance
There are two reasons you may need to renew your term insurance plan. First, your term plan lapsed, second; it got expired. Lapse happens when you fail to pay the premium for a month. The term plan is expired after the stipulated date on the policy. In both cases, term insurance renewal becomes important.
Your insurance company might send you a renewal notice before the policy expires but they are not obliged to do so. It is your responsibility to renew your policy on time. It should ideally be renewed within 15 days before the expiry date. However, if the policy has expired already, renewals can be made up to 15 days of a grace period from the expiry date. After that, you can only buy a new policy.
Term Insurance renewal process is simple if your policy has lapsed or expired.
- You can Buy the New Policy
It is the best option as you get to choose from a range of fresh policies and riders as per your needs. Buying the new policy online after comparing the features helps you get the best cover.
- Buy an Extension on Your Coverage
As your policy expires, you will stop paying the monthly premium. However, if you want to, you can extend the same policy within the grace period of 15 days by paying annual premium on it. The premium rates may increase in this case.
- Get Your Term Plan Converted into Endowment
Most term insurance policies come with an option of conversion where you can convert your term life insurance plan to a whole life term plan or an endowment plan. You get a lump sum amount on maturity of the plan.
The decision of term insurance renewal or buying a new policy remains with you. It is advisable not to make your decision looking at the premium amount only. You must also look into the background of the insurance provider and your needs before renewing term insurance.
Top companies offering term insurance in india
|LIC Term Insurance
- LIC's Anmol Jeevan II
- LIC's Amulya Jeevan II
- LIC's e-Term plan
|SBI Term Insurance
- SBI Life – eIncome Shield
- SBI Life – Smart Shield
- SBI eShield
- SBI Life – Saral Shield
|Tata AIA Term Insurance
- Sampoorna Raksha
- Sampoorna Raksha+
- iRaksha Supreme
- Maha Raksha Supreme
|Aviva Term Insurance
- Aviva iLife Term Insurance
- Aviva i-Shield Term Insurance
- Aviva Life Shield Advantage Plan
- Aviva Life Shield Platinum Term Insurance
- Aviva Life Shield Plus Term Insurance
- Aviva Sampoorna Suraksha Term Insurance
- Aviva Extra Cover Term Insurance
- Aviva i-Life Total
|Bajaj Allianz Term insurance
- Bajaj Allianz i-Secure Term Plan
- Bajaj Allianz i-Secure More Term Insurance Plan
- Bajaj Allianz i-Secure Loan
- Bajaj Allianz Life Secure Term Insurance Plan
- Bajaj Allianz Life Style Secure Term Insurance Plan
- Bajaj Allianz Life eTouch Online Term Plan
|Aegon Term Insurance
|Edelweiss Tokio Term Insurance Co. Ltd.
- Edelweiss Tokio Total Secure+
- Edelweiss Tokio My Life+
|Future Generali India Term Insurance
- Future Generali Flexi Online
|HDFC Standard Term Insurance
- HDFC Life Click 2 Protect Plus Life
- HDFC Life Click 2 Protect Plus Extra Life
|Max Life Term Insurance
- Max Life Online Term Plus Basic Life Cover
Other Popular Term Insurance Companies in India in Private Sector
- Aegon Life Term Insurance
- Reliance Nippon Term Insurance
- Sahara Term Insurance
- Bharti Axa Term Insurance
- Birla Sun Life Term Insurance
- Canara Hsbc Term Insurance
- Dhfl Pramerica Term Insurance
- Exide Life Term Insurance
- IDBI Federal Term Insurance
- Indiafirst Term Insurance
- Kotak Term Insurance
- Star Union Dai Ichi Term Insurance
- PNB Metlife Term Insurance
Top trending term insurance plans in india
Term insurance plan is a complete cover against unforeseen situations in life. It is also an effective long-term investment plan. This insurance plan comes with many assured benefits. Top insurance companies are offering different types of term insurance plans in India.
Here, we are providing a list for your ready reference:
||Entry Age (Minimum to Maximum)
||Policy Term (Minimum to Maximum)
|SBI Life eShield
||18 years to 65 years
||5 years to 30 years
||Minimum - Rs.20 lakh Maximum - No limit
|HDFC Life Click 2 Protect Plus
||18 years to 65 years
||10 years to 40 years
||Minimum - Rs.25 lakh Maximum - No limit
||18 years to 55 years
||10 years to 35 years
||Minimum - Rs.25 lakh Maximum - No limit
|Future Generali Care Plus
||18 years to 60 years
||5 Years to 30 Years
||Minimum - Rs.15 lakh Maximum - Rs. 50 Laks
|Birla Sun Life BSLI Protect@Ease Plan
||18 years to 65 years
||5 Years to 40 Years
||Minimum - Rs.30 lakh Maximum - No Limit
|LIC’s Jeevan Pragati Plan
||12 years to 45 years
||12 Years to 20 Years
||Minimum - Rs.15 lakh Maximum - No Limit
|Max Life Online Term Plan Plus Basic Life Cover
||18 years to 60 years
||10 Years to 40 Years
||Minimum - Rs.25 lakh Maximum - 100 Crores
|ICICI Prudential iProtect Smart
||18 years to 65 years
||10 years to 30 years
||Minimum – 2400 Per annum. Maximum - No Limit
|Bharti Axa Life Elite Secure
||18 years to 75 years
||10 years to 25 years
||Minimum - Rs.25 lakh Maximum - No Limit
|PNB MetLife Mera Term Plan
||18 years to 65 years
||10 Years to 40 Years
||Minimum - Rs.10 lakh Maximum - No Limit
Cover360 - poora term insurance services till claim
You do not have to look any further if you have reached Cover 360!
We are your one-stop-platform for everything you need to know and understand related to term insurance policies!
This is what makes Cover 360 the best and your number one partner to buy the best term insurance plan:
- We are the best directory of all insurance products available in the market, we can help you find the best term insurance.
- We are the best online tool to understand your exact insurance requirements and derive the best insurance plan for you.
- Our sort and filter options provide the best support and are simple to use. This helps you reach the most suited insurance product with utmost ease and clarity.
- We have easy to understand product descriptions with all the details incorporated, for each term insurance plan you are looking for.
- We offer the easy step-by-step procedure of insurance comparison helping you to buy the final product.
- We are always there to give absolute support while filing the documentation for the insurance policy.
- We offer complete support as and when needed, even after you buy the policy until you file your insurance claim.
- We have efficient, smooth and secure payment gateways to make easy and safe online payments on just a few clicks.
- We provide complete help with claim settlement of term insurance, in case you find any difficulty to get it done.
Apart from all the above, we can assist you with all the queries you may have related to the term insurance plan you want to buy.