What is Term Insurance Plan and why

In simpler terms, Term Insurance is a type of Life Insurance where you can get low cost premium life coverage within a specified period of time.

For example, if you are 30 now, then if you insure your life until the age of 65, then it will be a Term Plan. Even if you get Death Benefit in Term plan, you will not get any maturity benefit. In other words, if you die during this period of 35 years, then your family will be able to claim the amount of money that you have planned for the company.

So let's take a brief look at the advantages and disadvantages of the term plan -

1. This is the cheapest plan where you can get more life coverage with less premium.

2. This is a pure insurance which means only death benefit is available, no maturity benefit is available.

Suppose you are 30 years old now and you have bought a term insurance plan of Rs. 1 crore for 15 years. For this you have to pay approximately Rs. 6,500-7,000 as premium to the company every year. If you die within the maturity period of this policy, then your nominee can claim this 1 crore. But if the policy holder does not die within these 15 years, he will not get any refund of that premium money after maturity.

3. After the death of the policy holder, the nominee can withdraw all the term insurance money together or choose the option of monthly pay. This is what you need to select during form fill up.

4. How much premium to pay depends on many factors. Like what you are doing from an institution, how old you are, whether you have smoking habits, whether you are a victim of any complex disease etc.

The younger the term plan, the lower the monthly premium. If your smoking habit and medical history is bad then you have to pay more premium.

Let's take a look at the term insurance plan.

1. It covers all your loan and liabilities.

2. Add-on provides coverage for serious illness, permanent and partial disability, and accidental death.

3. It provides tax benefits under section 80c.

How to buy a good term plan-

1. The most reliable platform to buy a good term plan is Policybazar. This is an online portal where insurance can be bought cheaper than offline

2. Here many insurance companies can be seen together and comparative judgment can be made. This way you can choose the right term plan for yourself according to your needs and abilities.

3. Your family does not have to be in a hurry to make a claim here. Here you can easily claim directly in the policy market. Policybazar has Dedicated Claim Assistant program which is absolutely free

So if life coverage is your only objective and you do not invest in life insurance in the hope of getting a good return after maturity then term plan is suitable for you.