Term Policy Premium – What is it Exactly?
As mentioned above, term insurance premiums refer to a fixed monthly or yearly payment that a person needs to make in order to avail this type of protection from his insurance provider against all possibilities of untimely death during the tenure of their policy.
This means that rates payable under such policies are not subject to change over time and will remain unchanged till the end of the policy term.
The premiums may vary among insurance providers, and that is why it's best to compare term insurance premium quotes before investing.
Benefits of Paying Term Insurance Premiums Over a Longer Duration
Term life insurance has been specifically designed for people who do not need protection throughout their whole life or those whose children are financially capable of taking care of themselves without their support.
These policies have a fixed maximum limit known as the sum assured, which remains unchanged during the tenure of the policy, along with an additional feature called Level Term Insurance Premiums wherein rates payable under them remain constant over a period of time instead of increasing at regular intervals.
This means that a higher amount is paid towards the premium till the initial years of a policy, but in later years it is paid to depend upon the rate set by an insurer which remains constant.
This makes it affordable for younger people to buy term insurance and also protects them from any future price hikes.
Sum Assured or Term Insurance Premium – Which One Is Higher?
This depends upon various factors such as age, health condition of the applicant, the sum required, the profile of the individual, etc.
In general, individuals with good health will have to pay a lesser premium amount compared to those who are not in their best shape or suffer from some ailment or disease that can increase risk factors associated with a life insurance plan, whether term life insurance policy or an endowment plan.
Since shorter duration plans with lower premiums payable during initial years are available in the market, it is always advisable to buy term insurance when you are young and healthy.
Term Plan Premium
It is a one-time investment that offers you lifelong protection against any eventuality, provided you renew the policy at the end of its tenure.
In case of an unfortunate incident, your loved ones will be financially secure and can easily manage their expenses without worrying about the future.
In other words, it refers to a fixed monthly or yearly payment that a person needs to make in order to avail of this type of protection from his insurance provider against all possibilities of untimely death during the tenure of their policy.
This means that rates payable under such policies are not subject to change over time and will remain unchanged till the end of the policy term
The premiums may vary among insurance providers, and that is why it's best to compare term insurance premium quotes before investing.