We hear about this type of plan so much on the television with random celebrities giving us advice on how crucial it is to get one, sometimes in the form of Yamraaj and sometimes this nosy friend who is ready to give you random advice. However, the truth is, if you have dependants and regardless what age you are at, term insurance is not just a convenience but a necessity too. But before we get into why is it worth. Let us understand the idea of a term plan.
4 Things You Ought to Know About Term Plans
The term insurance plan offers you a life cover. It is a simple life insurance plan that promises to pay a sum assured if the policyholder dies during the policy period. If he outlives the term there is no maturity benefit.
- Since a term plan doesn’t offer any return and only provides risk cover it is less expensive.
- The sum assured in the term plan is high. That is possible because it covers the risk, by fulfilling the need for protection.
- In term insurance, the nominee receives the sum assured in a lump sum, or in equal instalments or a contribution in case of the death of the person during the policy period.
- The policyholder has the option to customize the payment option based on the family needs.iIt can be a lump sum, monthly or combination of both.
Why Choose A Term Plan?
- It is the simplest form of life insurance to understand and maintain.
- Term insurance is a good idea for people who are building a family i.e. getting married or planning a family.
- It costs lesser initially when compared to an endowment plan.
3 Factors to Consider When Taking a Term Plan
- Coverage Amount: You need to buy insurance for all the debt. Each time you take a large loan – usually a home loan, sometimes on a personal loan – buy a term cover for the full amount for the loan that you take.
- When to get a term plan: Buy as soon as you have dependents or the possibility of getting dependants. Touching thirty is usually a good time to buy the cover. You are old enough to have a good income flow and not that old for covers to be too expensive. The cost of life cover rises exponentially as you age.
- How Does it work: Term insurance is the simplest life cover. You pay a premium and in a term, if the policyholder expires, the insurance company provides the cheque to the nominated. If its the long term plan, you will get your cover till your retirement.
Where Can You Get Term Life Insurance?
Simply download MyWay Wealth app. Browse through our insurance section and choose Term Life Insurance to get a life cover in the comfort of simply wherever you are. You can even get a free callback from our insurance experts who will not only help you choose the appropriate policy but also help you make an informed decision.