What is Term Insurance?
Term insurance also referred to as term life insurance enable an investor to have coverage of their life for a given period of time. Although, the actual amount they pay is not exorbitant, they have a good protection on their life assuming they die within the period of the insurance policy. This benefit is paid to a beneficiary who has been nominated by the insured person at the time of subscribing for the policy.
Term insurance provides only risk coverage, no other redeemable profit. Since there is no savings element involved, you do not tender a huge lump sum to be your premium. What is required is a small amount paid in a rather normal interval to keep this cover in force for the whole of the term.
Why term insurance is the way to go?
Large cover: A young person has little likelihood of dying, and hence the amount of money he or she pays as premium is also little. A young man or woman of 25 or 30 years of age cannot imagine being in a position to provide for their beneficiaries the sum of Rs 1 crore only through their savings, investment and assets in the event of their demise. Hence, for such low premiums that they pay and more investment, they are in a position to help finance their family’s needs even when they are gone.
Add-ons: There are more options with which riders can be appended to one’s original term insurance plans as per the circumstances and condition in life. Some of the other common covers are terminal illness, employment and disability. These are the covers that when in the situation defined under the cover, you get the cover amount. Nevertheless, it is worth stating that in case of adding covers, such facets as the premium as well as the terms and conditions may rise.
Tax benefits: Cover paid through this cover is however, allowed as income tax deduction.
If you are still doubtful about getting a term insurance, contact our team at PolicyInserv, so that you can get all your questions answered to make an informed decision.
