what is term insurance in India

In the modern day, many Indians have limited awareness about the benefits of life insurance policies. When you love your family and care about their future, then you need to safeguard the financial safety of them in your absence. You need to know ‘what is term insurance’ before purchasing them for the benefits of your family. Term Insurance is the ultimate instrument for ensuring that your family does not lack the financial resources.

Term insurance involves a Life Insurance premium that offers better financial coverage for the policyholder. Normally, these are set for a limited period of time. For instance, in the event of the death of the policyholder, the premium coverage could be helpful for the family.

Premium coverage is paid to the nominee of the policyholder in the event of the death of the policyholder during the policy term. It is essential to know ‘what is term insurance policy’ along with many key features before buying them. It is a better way to opt for the term insurance policy based on the premium rates.

Purpose of Taking Life Insurance:

Main purpose of buying the term insurance plan is to provide life coverage for the policyholder as well as financial security for the family. Normally, there are many numbers of ways you can simply take Life Insurance coverage.

  • Term insurance – Pure life coverage policy
  • Endowment insurance – Life cover with the savings component added

Why Term Insurance Is Beneficial?

The term Insurance plan offers complete life coverage, and it does not involve any profit or saving components. Term plans are especially the basic plan for making the coverage more affordable. Normally, the policyholder could easily opt for the large file coverage even at the lower premiums. These are much more effective when compared to other endowment plan. Know what is term insurance and how does it work as it helps to make the right decision about purchasing the coverage.

  • Provides Add-Ons: Upon buying the term insurance, you can also add riders along with the policy. These riders are suitable for easily extending your policy benefits. You are required to pay the additional premium to get comprehensive coverage.
  • Cover Against Eventualities:Are you looking to secure your loved ones during the financial crisis in your absence? Having Term Insurance is a great way to take significant coverage even for the lower premium rate.
  • Better Cover For Critical Illnesses:Some people between the ages of 30 and 40 think that they do not require an insurance plan for their health. You would never know that you could be suffering from a severe illness like kidney failure, cancer, and many others. It is better to know what is term insurance in India and purchase the right package for your future. These are helpful for your loved ones if their health deteriorates.
  • Secure Assets:Many people have taken loans such as education loans, vehicle loans, personal loans, and home loans. Repayments of the loans could be financially weighing you down for the family in the event of your demise. Having the Term Insurance plan is the best way to proceed and pay off the loans in your absence.
  • Financial Security For The Family:Are you the primary earner in your family? Buying the term insurance plan is a great option for your family to take care of monthly financial requirements in your absence.

What Are The Types Of Term Insurance?

In the modern day, there are many types of Term Insurance available. The level of the term policies also varies from one company to the other. It is important to find what is term insurance plan in India along with the benefits. Main reason is that each policy has Pros and Cons for the beneficiaries as well as the policyholders.

  • Increasing Term:

    Some Term Insurance policy allows for an increase in death benefits for nominees. Normally, the premium increases but allows the policyholder to pay lower premiums. Increasing the term would also prevent qualifying another policy as you are old.

  • Convertible Term:

    Convertible Term Life Insurance is suitable for those who like to buy term insurance for a limited number of years. When the time expires, the policy will be converted into universal Life Insurance or even whole life Insurance. Biggest advantage of this convertible insurance for the policyholder is getting lifelong coverage.

  • Mortgage Term: (Decreasing Term):

    The Mortgage Term involves the death benefit amount decreasing with time. The main goal of this method is to match the decline of term benefits with reducing the outstanding mortgage of the policyholder.

  • Annual Renewable:

    Annual Renewable are types of term insurance that can be easily renewed. Main advantage of this annual renewable-based term insurance is the coverage. These are guaranteed to be approved every year, even without any hassle. You need to know what is term insurance and life insurance as both of them have differences in features.

What Is The Minimum Eligibility For Term Insurance?

Normally, the minimum age limit for Term Insurance is 18 years old. It is essential to become eligible for buying the term insurance plan. Whether you are buying term insurance at a young age, then, you can get massive coverage by saving money on premiums.

FAQ Question

    • What is The Term Insurance Meaning?

      Term Insurance is the most amazing pure life insurance policy that offers added protection for the policyholders. These provide better coverage of the insurance for a certain period of time. The insurer would provide a guaranteed sum of money in the event of any unfortunate event under the policy. These are helpful for providing compensation for the nominee in the event of demise.

    • What Is Term Insurance, And How Does It Work?

      The Term Insurance is widely preferred by many people for its pure life insurance product. These offer better financial protection for the family holder or nominee of the policyholder. These also provide large cover even for a specific period of time with the fixed premium amount. Normally, the policyholder pays the premium for coverage. In the event of the demise of the policyholder, the nominee would get the sum of the premium.

    • What Is An Example Of Term Insurance?

      Term insurance can be easily understood with the example. Johnny buys a Term Insurance plan and becomes a policyholder. He is paying about Rs 500 per month as the premium for the Rs 1 crore term plans. Johnny has placed his son David as a nominee for the term insurance plan. In the event of the death of Johnny during the policy term, then the insurer would be paying the sum of Rs 1 crore to David.

    • Which Is Better, Term or Life Insurance?

      Comparing the term and Life Insurance plan is quite difficult as this varies with the terms and other features. It is essential to understand the difference between them before applying. Whether you are looking for life cover with the lowest premium, then you can choose a Term Insurance plan. Whether you are in need of a savings plan with massive benefits, then you can choose a Life Insurance plan.

    • Is It Good To Take Term Insurance?

      Of course, you can purchase the Term Insurance plan to ensure your family gets better returns in the event of your demise. Term Insurance especially provides a large sum of coverage in the policy. These are available at the most affordable premium. There are also many numbers of Add-ons available, which bring more benefits. Term Insurance is an excellent option for saving your money on the monthly premiums.

    • What Is The Difference Between Term Insurance And Life Insurance?

      Normally, the Term Insurance plan provides death benefits in the event of the demise of the policyholder. The Nominee would be getting the coverage amount. A life insurance plan involves providing the maturity benefit and death benefit for life assured. It is a better option for understanding the Life Insurance plan and term insurance plan before purchasing the plan. The term insurance plan offers more life coverage at the most affordable premium.

    • Why Should You Buy Term Insurance In India?

      Many people prefer to buy Term Insurance in India because of its affordable price range. It helps to easily save more money in the process when compared to buying Term Insurance from companies abroad. There is also term insurance for the NRI, which is 50% cheaper when compared to abroad. Are you looking to buy a term insurance plan? You can easily buy term insurance in India to get more benefits.

    • What Are The Minimum And Maximum Age Limits To Buy A Term Insurance Plan?

      The term Insurance plan also involves minimum and maximum eligibility. These could vary from one insurance company to another. Some of the common eligibility criteria for the age limit are listed below. The minimum age limit is 18 years old, and the maximum age limit is based on the insurer. You need to know about the minimum and maximum age limits for the Term Insurance plan with seeking your insurer.

    • What Are The Factors That Affect The Term Insurance Premium Rates?

      Some of the factors that could affect the Term Insurance premium rate are age, amount of insurance coverage, yearly income, and more. Apart from these, health conditions and lifestyle habits such as smoking/non-smoker also play an important role in setting the premium rate for the term insurance. Availing of the term insurance policy by following these attributes is quite essential.


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