There is no certainty in life, and you never know when a mishap may result in your absence. Even with technological development and progress in science, there is no way to predict what the future holds for you. Protecting your family is simpler when you are with them. However, who will look after them during your absence?
Thus, you need to do adequate planning for their financial future to ensure that they are not helpless when you are not around. A term plan is an excellent, simple, and affordable way to achieve this objective.
Do you know what is term insurance? A pure life cover pays the financial coverage to your beneficiaries in case of an unfortunate incident during the policy’s duration. The payout may be either a lump sum or a regular amount payable at periodic intervals or a combination of the two.
Here are four reasons why term insurance is important:
- Cost-effective
You can avail of a higher sum assured for your family at a nominal premium. Your beneficiaries receive this coverage in your absence. As there is no investment component to build wealth over the long-term, this plan comes at an economical premium.
- Financial security
If you are the sole breadwinner of the family, your loved ones may be unable to sustain their normal lifestyles in case of an unforeseen event. Without proper planning, they may be left with a huge burden of outstanding liabilities, making it difficult to meet regular expenses. A term plan ensures your family does not face such adverse financial constraints in your absence. Ideally, you must use a term insurance calculator to know the sum assured required to provide your family with a financially stable future.
- Additional riders
Insurers offer extra riders to enhance the coverage of your base policy. Based on your requirements, you may choose between riders like accidental death, critical illness, waiver of premium, and permanent or temporary disability. These riders ensure you or your family members do not suffer from a liquidity crisis in any of these situations.
- Low claim rejection
When you buy a term plan, you need to provide accurate information about your health, habits, and financial situation. This ensures that there is a lesser possibility of claim rejection in case the need arises.
Several people consider a life insurance plan asa financial burden, especially when they are young and healthy. Regular life policies like money-back, whole-life, and endowment plans are expensive. However, term plans are reasonable, and there is no reason why you should delay your decision any further. Here are four differences between term policies and other life insurance plans:
| Term plans | Other lifepolicies | |
| Policy benefits | Only paid to beneficiaries in case of your absence during the policy duration | Paid to your nominees; however, the sum assured may not be as high as that of a term plan |
| Maturity benefits | Not available, except for term plans offering a return of premium, wherein the total premium is returned on maturity | Provide maturity benefits either as a lump sum or as a periodic payout (money-back policies) |
| Coverage | Pure protection plan without any investment component | Life cover along with an investment or savings component |
| Premium | Inexpensive; allowing you to procure a higher coverage at a pocket-friendly price | As these include savings or investments, the premiums are higher when compared to term policies |
Modern living is full of comforts and your family is used to a certain way of life. Therefore, an online term insurance plan is a necessity today. It ensures that your dear ones can live peacefully and not go through financial distress due to an unfortunate incident.
Compare different products offered by various insurers to find a policy that offers the maximum benefits. Get your term plan today and safeguard your family from financial uncertainties in the future.
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