Term insurance plans are an extremely handy form of life insurance. You get a substantially large life cover at quite an affordable rate. Additionally, you also get the option of insuring yourself for a really long duration of time. As a result, term insurance is necessary for everyone. However, to find the best possible term insurance plans, you first need to understand how term insurance works and what the ideas behind term insurance are. Take a look at this article to learn more about a term life insurance policy.
Ideas of Term Insurance Plans
Let us now understand the basic ideas, or concepts, on which term insurance is based:
- Pure life cover: The idea behind buying term insurance is to get a pure life cover, without any frills whatsoever. So you get to insure your life at a premium. You pay the premium regularly, and in return the insurer promises to pay your nominees the death benefit if you die. If you outlive the policy period, there is nothing in return. This is the basic idea behind the term insurance plans.
- Fixed premium: Another idea behind term insurance is to provide a life cover at an affordable rate. Since there is no return component in the term plans, you get the cover at a very low rate. But that is not all – the premium of a term policy remains fixed for the entire duration of the policy. So if you buy a term cover at a rate of INR 700 a month now, you will be paying INR 700 a month even ten years down the line! This is an extraordinary benefit of buying term insurance.
- Different modes of pay-out: Another interesting concept of term insurance is the pay-out options. You get to choose how your beneficiaries will receive the death benefit after your demise. There are two options to choose from – the lump sum pay-out and the staggering pay-out. If you go with the lump sum option, your family will get the entire sum assured in some go and the policy will terminate. Choose this option if you feel your family members are financially sound and well equipped to handle large financial matters. Else, go with the staggering option. Your nominees will then receive the death benefit in instalments, over a fixed period of time. You can choose the value of the payments and the duration to ensure your income is replaced by the pay-outs after your death.
These are the major ideas that work behind the term insurance plans. As we can see, they are very logical and make the term plans beneficial for us.
Some of the providers of Term Insurance Plans
There are some excellent term insurance plans available in India these days. The plans are available online, as well as offline. You can find some great deals and get a comprehensive life cover at a very reasonable rate. Some of the insurance providers who offer the best term plans are:
- LIC: The Life Insurance Corporation of India is the largest and the most popular provider of term plans in India. LIC is an excellent insurer to choose if you are looking for a new term plan. This is because LIC settles over 99% of the claims and has an excellent range of products to choose from.
- HDFC Life: Among the private life insurance providers, we have some good names such as HDFC Life. The company has some of the best term insurance plans on offer. Their online term plans are especially good and chosen by many people.
- ICICI Prudential: Next, we have ICICI Prudential, one of India’s largest and most bankable life insurance companies. The insurer boasts of a high claim settlement ratio and has some very good term plans. Choose an online or an offline term plan from ICICI Prudential to find a wholesome life cover.
There are many available options. It is always a good idea for you to compare the term insurance plans to find the best deals at the best rates.
In a nutshell
To put it in a nutshell, term insurance is useful in many ways. So as you can clearly see from the points mentioned above, you get not one, but many benefits when you choose a term plan. Thankfully, the term insurance sector has really boomed in India and you have many good options to choose from. So do your research and get a good term life insurance cover right away.