Term insurance is one of the most important and easiest plans provided by an insurance plan. It is the simplest form of life insurance; by simplest, I mean easy to understand; you don’t have to depend on an agent or a specialized financial advisor to guide you.
Life insurance is one of the most important investments we all have to make in today’s world. A term life insurance assures that your family’s financial condition will be stable even in your absence. This means in case you die; then a lumpsum amount will be provided to meet your family’s financial needs and daily expenses. In this article, we will discuss the importance of a term insurance plan in your life.
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What is a term insurance plan?
A term insurance plan is a pure protection plan. It only provides a death benefit to the policyholder. This means Their family will receive the corpus amount if the policyholder dies during the policy period. But if the policyholder survived after the policy term ends, then they will not get any benefit. So the sole aim of a term plan is to secure your family’s financial needs in your absence.
Benefits of a term insurance plan
Let’s discover few fundamental benefits of a term plan over other insurance plans.
- Its low cost – The premium you have to pay is low compared to an endowment plan. This is because endowment plans are for savings, and term plans only cover risk and provide protection. Also, there are many term plans available online. The term plans provided online are cheaper than protection plans provided offline because the cost of an agent or any intermediary can be subtracted. One can easily calculate how much premium he has to pay after analyzing their financial needs.
- Long-term cover: A term insurance plan can be chosen in a wide range of terms like – 10, 15, 20, or 30 years. You can choose your coverage term as per your choice. Term plans like Edelweiss Tokio Life – MyLife+ provide coverage up to the age of 80.
- Convenience: Purchasing a term is very convenient. Since the entire buying journey is online, you can buy insurance online and submit your documents online. Even medicals will be conducted at your convenience.
- Riders: Some term plans like MyLife+ do provide riders like Accidental Permanent and Total Disability rider. This rider is a boon because it provides the lump sum if the policyholder meets with an accident and is permanently disabled.
- Payout options: There are term plans which provide an option to choose your payout option as per your needs. This payout option can be provided to the nominee monthly, the entire lump sum, or a combination of both.
- Tax benefits: All term plans do provide tax benefits.
- Overall to summarize, an online term plan is a must for the ones with dependents or some responsibilities.