Financial planning is such a crucial part of healthy living and well-being. It is hard to put a price on the peace of mind you get, knowing that in case of an emergency, you and your loved ones will be protected. Term insurance plans are among the top financial instruments that provide that peace.
Term insurance plans are a form of life insurance policy but with much lower rates of premium and varying policy tenure.
Term insurance plans, much like any other life insurance type, require you to choose the sum assured that your loved ones will receive as maturity benefit in case of your premature demise. You can choose the tenure of your policy for as short as 10 years or as long as 100 years to insure your entire life.
The insurance provider takes into account the specifications you chose along with your personal details and quotes the rate of premium.
You can also use a term insurance calculator to derive the figure yourself, based on your preferences. It can help you derive realistic financial solutions to acquire the right kind of term insurance plans for you.
Term insurance plans come in many forms. Depending on your preference, ability to pay the premium regularly, liabilities that you may have or a desire to develop a steady habit for investment, you can choose from the top term insurance plans in India:
One of the best term insurance plans that helps beat the rate of inflation while securing the future of your family and loved ones is the increasing term plan.
The concept is quite simple. You choose your sum assured, policy tenure, and the annual increment of your policy. Every year, the insurance provider increases the initial sum assured by the increment percentage that you specified.
In case of your untimely demise, your beneficiaries receive much more money than you originally signed off for. This is particularly helpful because the value of the Indian Rupees diminishes every year with the rate of inflation. Therefore, the increased amount sufficiently corresponds to the value you estimated when you purchased the policy.
If you have huge loans and liabilities, these are the term insurance plans for you. The concept is different in the sense that instead of increasing the sum assured to beat inflation, the insurance provider decreases your sum assured by a specified amount. The amount that is deducted from the sum assured annually is used to pay back lenders. That way, you keep working down your liabilities, therefore in the event of your untimely demise, the load of loans, mortgages, debts, and liabilities is far less daunting for your loved ones. They will receive the remaining sum assured, which is still a hefty amount. They can use it to repay whatever liabilities remain or plan for their financial well-being.
If you have a lumpsum amount of money handy but are sceptical about being able to pay premiums monthly or annually, this is the best term insurance policy for you. You choose the sum assured much like any term plan and specify the policy tenure. Then you pay a lumpsum premium upfront.
If you do not have a steady source of income or want to invest in your family’s future but struggle with financial planning, this plan works perfectly. The one-time premium payment guarantees that the future of your loved one is secured. You use the lump sum amount for a viable cause and become stress-free, and your income source does not affect your financial planning anymore.
Choosing the best term insurance plan in India is all about selecting the policy type that works best for you and your family. Evaluate the benefits of all the term insurance plans. You can always opt for more than one term insurance policy but make sure that it serves your financial need and supports your family’s lifestyle in case the unforeseen happens.
A term insurance calculator is a simple tool that helps you figure out the rate of premium that will be suitable for your term insurance plans. You will need to feed the following data into a term insurance calculator to derive a tailor-made premium amount for you:
Apart from the details of your policy, you will also need to furnish personal information that affects the rate of premium:
You will also need to provide your name and contact details so the term insurance calculator can determine a personalised rate of premium for you and the same can be shared with you. Each plan’s benefits differ and riders that you add to your term plans will also affect the rate of premium. You can use the term insurance calculator to modify the preferential details till you reach a figure that agrees with you.
Term insurance plans are safety nets that benefit you and your family in the long run. Take some time to evaluate the different types of policies and choose the ones that best suit you. The term insurance calculator will then help determine your premium rate, and you can evaluate with certainty exactly how much you can invest and how it would benefit you and your loved ones.
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