Single premium term insurance policy is designed for those who want to buy a policy at one go. As compared to traditional insurance products, policyholders have to pay premium at periodic intervals for these policies.
It is a onetime payment solution for those who don’t want to go through the trouble of periodic payments. When the premium payment has been done, buyer becomes the policy owner with certain death benefits.
For single premium term insurance policy, policyholders don’t have to worry about paying any further premium payments or the lapse of your insurance if insured forget to make any payments.
All leading insurance companies in India offer this insurance for the benefit of their clients and customers can access some policy aggregator portals online to know which one is suitable for your needs. If you have a lump sum fund with you, then it is advisable to opt for a single premium term insurance policy.
Under this plan, policyholders get financial security against taxes. When person invests in this insurance product, he or she is given exemption of up to Rs 1.5 lakh. In case something happens to policyholder, his or her beneficiary would get the insurance money which is absolutely tax free.
But, insured is eligible to avail the tax exemption benefit only once for this policy because policyholder is investing in this term insurance for one time only. As you paid up in full upfront for this policy, so you don’t have to worry about the plan getting lapsed if you forget to pay the premium amount.
Your policy is completely valid till the entire policy term and reduces the sum assured when the policy period comes to an end. It generates cash value. Person is building a financial asset for himself or herself when he or she makes the premium payment for single premium term insurance. It comes in handy if you want to apply for loan and can be used as collateral against loan.
“In life we all strive to plan well and planning is all about living well.” But no matter how much you try everything in life does not go as planned. At times, life throws up nasty surprises and we have to accept it, live with it and move on. Many a times you may have planned various things for you and your family in future. But what happens if you struck with untimely death? Your entire family suddenly turns orphan, and if you were the only breadwinner it only adds to the difficulties for them. Therefore, insurance market has introduced the term plans whose main objective is to protect your family financially from unforeseen circumstances. Term insurance plans have a high risk protection component. The main protection plans protect the family against the ‘cash flow risk' of the untimely death of the breadwinner. The only way to somewhat reduce the pain of death in the family is to make sure that at least financially the family is secure.
In India there are around 20+ insurance companies offering various sets of life insurance policies to people. Many a times the product list is so vast that it becomes very difficult to choose among the options available. Therefore, in order to buy the right type of life insurance, an individual must perform some research and evaluate various policies according to their own requirements. The first thing you need to do is assess your own needs before deciding what you want to buy. There are various policies such as unit linked, whole life insurance or term insurance plan in the market available for the potential customers. All you need to do is just understand your needs, do a bit of research through online portals or calls or visiting the insurance companies and just buy a suitable insurance policy.
Term insurances are one of the best tools of modern day life insurance schemes which comes in the form of a straightforward protection plan, that enables the insured to get adequate life insurance cover at an affordable cost. The reason being straightforward is that term insurance is a pure risk coverage plan i.e. it covers income related risks. It protects your family against financial hardships in your absence. But Best Term Insurance plan cannot be perceived as an investment tool as it does not provide any maturity value to the policy holder in case he/she outlives the term period, unless he/she chooses a return of premium term plan.
In order to buy best term plan in India, there are few things that a person must consider. One must compare term plan offered by various insurance providers as different policies has different types of coverage’s. Remember term is straightforward so higher the insurance coverage, higher the insurance premium and vice-versa. You should carefully study the fact that your ideal choice term plan should cover the household expenditure, major expenses like marriage of the children and other liabilities like loans. Life cover should be adequate in order to achieve the purpose of insurance.
Determine the time frame between 5-25 years till you require insurance cover which can be associated with your dependents. Buy the insurance policy till the time you have dependents depending on your income. Not to forget inflation, any amendments in policy structure by government should be considered so that the insurance policy satisfies your financial requirements in the future.
It’s better to buy term plan earlier in life as premiums set are low when you are young. Always compare to buy cheaper term life plan and most importantly an effective one. An individual can use comparison tools provided by insurance aggregators online to compare term plan rates which will eventually help you to buy best term insurance plan in India.
How important is life insurance including child plans?
Child life insurance is a form of permanent life insurance that insures the life of a minor. It is usually purchased to protect a family against the sudden and unexpected death or disability of the breadwinner. Child life insurance policies typically offer the owner the option to purchase, or in some cases obtain additional guaranteed insurance when the child reaches maturity.
As we all know, nothing in our lives is guaranteed and in the event you pass away, your loved ones will be severely impacted both emotionally and financially. It is therefore important that you make sure that the financial needs of your loved ones are provided for and to prevent that loans, such as your bond or any other debts, will not become their responsibility.
If you are struggling to afford your current life insurance premiums, remember that there are quite a number of alternatives that are well worth considering, instead of cancelling your policy altogether. They are as follows-
Decrease the value of your life cover policy
If your current life insurance premiums are high and you can no longer afford to pay them, you could perhaps decrease the value of your cover, so that at least your dependants will have some funds available instead of none at all. Most life insurance providers will be able to assist you in lowering your monthly insurance premiums by adjusting the value of your life insurance cover, which is certainly an option worth considering.
Change from permanent to term life cover
If you currently have a permanent life insurance policy, you will be paying higher premiums than if you were to have a term policy. It is advisable to speak to your insurance consultant to enquire about the possibilities of changing your cover. Term life cover is usually cheaper than permanent cover, which may have a big difference in terms of affordability. Should your financial situation improve over time, which is always a possibility, you can change back to permanent life cover.
Shop around for a cheaper life insurance policy
No matter which type of policy you currently have, such as a permanent life insurance policy or a term policy, it is always possible to consider other alternatives. You could go online and do some research into different insurance companies, and compare the cover packages they offer as well as their monthly premiums.
Get Unit Linked Insurance Plan for two-fold benefits-
A Unit Linked Insurance Plan (ULIP) is a product offered by insurance companies that unlike a pure insurance policy gives investors the benefits of both insurance and investment under a single integrated plan.
Did you know that term insurance rates differ by more than 40% across several companies in India? This brings to a simple conclusion that getting term insurance at the lowest possible premium and maximum coverage is important. However, deciding from a cohort of diverse rates where each company claims of best of the offerings, it may become little difficult.
The purpose of this article is to make the reader informed about getting the right approach of research to be able to buy the best and the safest term insurance plan in India.
Further you can browse through relevant points which will help you in selecting the best and the safest term insurance policy in India.
It all starts with a careful selection-
It is a famous saying, “If you want it to be a good journey, the start should be great.” The same applies to when selecting your term insurance provider. You should get term insurance only from an insurance company which is valid as per the IRDA-Insurance Regulatory and Development Authority.
An insurance agent may not always be the best option for the following reasons-
· The plan recommended can be way expensive
· He’s more likely to recommend you something where he can get a higher commission.
Term plans provide low commissions to agents. Since, last few years, term insurance rates witnessed significant cut by 40-50% thanks to increased competition & lower mortality rates.
Getting term insurance online is easier as it gets for several reasons-
· One can easily compare features and prices of several term insurance plans
· The process is simple & fast
· Most companies enable all documentation & medical test reports to be delivered to the insured’s home
· Most insurance companies favor lower commissions for online sales. Hence, you can get term insurance plans at lowest rates which can save you 30% money than the offline way!
· One can easily pay his premium via credit card or net banking
What if the policyholder survives throughout the policy duration?
Consider that the policyholder survives throughout the policy duration. In this case, the risk cover will be terminated. Therefore, there won’t be any amount paid to the policyholder nor his dependents.
However, if the policyholder dies during the policy period then a sum assured amount will be paid to the policyholder’s dependents. The insurer will pay the sum insured amount to policyholder's dependants or the one who is listed as the nominee in the policy.
Term insurance plan can be looked upon as savings plan or as a protection cover.
It’s a good investment option for retirement benefits.
One surprising fact is that products like ULIPs and insurance are looked upon as long term investment options. However, their very basic function which is to provide insurance or protection is ignored to large extent.
Note- The distributors tend to sell policies unfairly. They sell policies just to obtain higher commissions by charging higher annual premiums to the buyers. Hence, it is important to take the help of professional to avoid such problems.
Term insurance is ideal if you want to save money and avail life coverage for a particular time span. Term policies offer insurance coverage for a relevant tenure at fixed rates of interest and premiums. The prime goal if a term policy is to provide life coverage and reduce all the financial responsibilities of the policyholder. A term plan is an affordable and hassle-free life insurance that gives instant protection and flexible payment options. Lowest premium rates and availability on online term life plans are the important reasons why people choose theses insurance plans. Buy a suitable online Term Insurance policy and avoid all the troubles that usually accompany its offline counterparts.
Why go for online term insurance India?
Online term insurance India has become the easiest way to get a suitable term insurance policy. It is because online you can browse through all the good insurers within minutes and finalize your pick. And when you get a suitable online term insurance plan in India you get the following benefits-
Benefits of getting online term insurance India:
• Term insurance plans are easy to understand. The terms and conditions of these policies are simple and comprehensive even for the beginners.
• Term insurance plans are affordable and come with flexible payment options including regular and single sum premiums.
• Term insurance plans offer basic life coverage therefore they are affordable. Some insurers offer additional riders like accidental death and critical illness insurance at additional premiums.
• Along with life coverage, these plans reduce other financial responsibilities of the dependents like mortgage, business or education loans.
• With online term plans you can buy a customized coverage at your convenience. You can also choose online payment options for the policy premiums.
• Some insurers provide attractive introductory riders including waiver of premium, critical illness, female critical illness, free of cost accidental death and death in terrorist attacks.
• Choose the suitable policy tenure from 5 to 40 years. With term life, you can enjoy insurance coverage up to 75 years of age.
• Use your insurance policy as a tax saver policy. These plans give tax benefits under Section 80C of Indian Income Tax Act. How online term insurance works
Online term life is simple and comprehensive even for the novices. When you decide to buy a term life policy, the first thing to do is to calculate the sum assured and affordable premiums. You can easily do that by visiting the website of your preferred insurer. They provide free online premium calculator for your assistance. All that you need to do is to choose the suitable policy and fill in the required details including your age, desired sum assured and tenure, medical information and other personal information. After filling in the information, you will get estimated premium quotes.
After you pay the initial premium, you will get a call or confirmation email. The insurer may also send a KYC (know your customer) representative at your home for additional details including personal information and other documentation. Depending on your age, you will need to undergo a medical test.