It does not take a lot for anyone to understand that life is unpredictable in a lot of instances. While there isn’t a great deal that you can do to counter the unpredictable nature of life but there is a small step that you can take. When you buy a term insurance you do your best to negate the biggest or most unfortunate events that can take place during a lifetime. For all other things, you can use your experience and intelligence.
A term insurance is one of the simplest forms of life insurances that you will ever come across. When you purchase a term plan you essentially pay a premium for a certain period of time. In the unfortunate event of the death of a policy holder within the policy term, the named nominees will receive a pay-out from the insurer. And if you live through the term, there are no maturity benefits to be had.
Thus, you can put term insurance into a rare no-nonsense category of insurance products in today’s day and age. Rare, because products these days try to do a whole lot of things and might at times fail at the very reason for their existence. A term insurance is better than all other insurances because of a couple of major reasons.
- Easy on pockets
Term plans give you access to massive sum assured by paying really affordable premiums. A quick comparison of sum assured versus the premium paid against other insurance policies can open your eyes.
- Concentrated Approach
Since a term plan focuses only on providing life cover, it excels at that. Unlike most other insurance products, it doesn’t have a savings or investment component. Rather the entire premium is invested towards getting the maximum life cover for you.
Reasons to Choose Term Insurance
Some of the major reasons why one must invest their hard earned money in a term plan are listed out below.
Should you finalise that you need to buy a term insurance plan, there is a great deal of flexibility available at your helm; starting from the ability to buy a term plan online or offline to the sum assured that you are looking for. You have the say in the duration of the policy as well as the payment options. Of course, the presence of worthy riders only makes the deal sweeter.
- Rejection Ratio is low
One of the biggest advantages of a term insurance is its low rejection ratio. If your policy has been active for more than 10 years, the probability of the rejection reduces to a great extent. One must be careful while buying the plan and ensure you mention all the information as accurately as you can. Recent modifications by the IRDAI ensure that insurers cannot reject claims stating non-disclosure of facts if the policy has been active for at least two years.
- Financial Stability
By paying a very low premium of INR 650 monthly, you get access to about INR.1 crore as the sum assured. Should anything happen to the policy holder, a term plan ensures their loved ones are not financially stranded. Of course, it is essential that you keep reviewing the policy from time to time and increase the sum assured as time passes by.
If you wish to extract a bit more from your term insurance, opting for riders is your best bet. There is a wide range of riders available which cater to different needs. By paying a small sum as premium you can enhance the capabilities of your term plan.
How Does Term Insurance Benefit Us
If you are considering to buy a term insurance plan, there are two major benefits that you must keep in your mind.
- High Sum Assured
Depending on what your requirements are and how much premium you are willing to pay for the same, you can get a life cover of anything from INR.25-30 lakhs to about INR.4-5 crore. These numbers are huge and can suffice most of the needs and requirements of families. As mentioned earlier, do make it a point to review the same from time to time.
- Low Premiums
Getting such high sum assured values by paying relatively lower premiums makes a term insurance an interesting product. It is in fact, one of the cheapest insurance products available in the market today.
Individuals having a lot of responsibility on their shoulders for their loved ones should seriously consider buying a term plan for a secure future.