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How To Choose The Best Term Insurance Plan?

Explore The Features and Benefits of Term Insurance Plan

Insurance is critical in today's era. Do you think why it is essential? Well, there is no one reason for taking life insurance. In this article, you will get an overview of the vital role that insurance plays in a policyholder's life.

A modern man is cautious and has some planning for the future. It is obviously essential to keep some protection for your family in case of any sudden mishaps. Term Insurance is one of the best life insurance policies. This is a perfect protection plan in case the policyholder dies during the policy life. The nominee will get the amount in this case. Also, Term Insurance is the most cost-effective solution for all your worries.

Opting for a Term Insurance will be the smartest step for a secure future. The next big decision will be to choose the best plan giving you the maximum benefits. Insurance cover is advantageous when you learn about the typical features and related benefits of the policy. Moreover, you must go through a set of tips before investing in any policy.

Let us look at the various benefits of the best term insurance plan to protect your family.

Salient Features Of A Term Insurance Plan

  1. Claim Settlement Ratio

    This ratio refers to the claim percentage out of the total amount of claims settled for the plan throughout the year. A higher claim settlement ratio indicates a better position for the claimants after the death of the policyholder. The primary purpose of Term Insurance is the protection of your dependents' lives after you. Everyone wants a comfortable and secure life for his/her family, even after him/her. The claim settlement ratio becomes more significant when the insurer settles a substantial amount of claims.

  2. Critical Illness Coverage

    With Term Insurance, critical illness cover also comes along. The majority of the customers will prefer a critical illness cover in their own plans. Thus, your family will not come to the streets all of a sudden if anything happens to you due to chronic disease. The most common examples of critical illness include the names of cancer, brain tumor, and others. Treatment for such diseases or surgeries can cost lakhs. As a result, the financial condition of a family can go through a really tough time. An insurance policy can act as a safeguard from the upcoming challenges due to a crippled financial condition. The most significant advantage of such a plan is receipt of the cover amount immediately on the diagnosis.

  3. Solvency Ratio

    Choosing your insurer wisely is extremely important to obtain a secured policy. To depend on this plan, you have to be faithful towards the insurer first. The solvency ratio will enable you to decide whether the insurance company is financially capable of settling your claim. As per the IRDA guidelines, the standard solvency ratio for a life insurer should be a minimum of 1.5.

    In times of natural disaster, the insurer can get a large volume of claims in a very short period. An appropriate term insurance policy will not let you compromise with your family's security. So the role of the solvency ratio is vital for selecting the best policy.

  4. Premium Cost

    While taking any policy, the cost factor is highly essential. The premium amount is the most vital parameter for choosing any insurance policy. Prior to signing the policy document, you must go through the terms and conditions very well. Your final decision should depend on the cost factor. Moreover, you should compare the terms and benefits of different insurers to invest in the best plan. Again, the premiums for term insurance also fetch you tax benefits under Section 80C.

Additional Benefits Of A Term Insurance Plan

  1. Income Benefit

    Some policies come with a chance of the regular income of your family. It is just like a pension scheme. After your demise, your family members can get a particular amount every month. In this way, you can arrange for a permanent income for your family. It is a convenient term, indeed.

  2. Waiver of Premium

    If the policyholder suffers from a permanent disability, there is no need to pay the premium anymore. The policy will continue automatically. This clause can be more convincing than any other clauses as it involves a waiver of premium.

  3. Accidental Death

    As the name implies, this cover is for the deaths due to accidents. This policy includes an enhanced sum assured only for accidental deaths. In most of the reliable term insurance policies, you will get this cover. Generally, the amount is equal to the base amount of the plan. As you see that these benefits are a part of your policy, don't hesitate to sign the document. Read the agreed terms carefully to avoid any kind of disputes in the future.

Why Is Insurance Cover Essential?

Financial stability acts as the backbone of your life in today's times. You can understand, from the above discussion that an insurance cover can provide maximum protection to your family, even when you are not around. Moreover, there are several benefits attached to insurance plans. Some of them are listed below:-

  1. Whole Life Cover

    The best term insurance plans come with entire life coverage until the age of 99 years. Therefore, it ensures protection for a longer period.

  2. Affordable Premiums

    A high-value life cover is possible from such a plan by paying only a small premium amount. The premium duration can be monthly, half-yearly, or annually. Moreover, the amount of premium varies a lot as per the age of the policyholder.

  3. Coverage for terminal illness

    If you become the patient of any kind of terminal illness like AIDS, the term insurance can come to your rescue. This additional rider will reimburse the medical expenses. It pays lump-sum amounts for diagnosis.

**Tax Benefits

Tax benefits are another appealing feature for any term insurance policy. You can get a deduction under section 80C for the premium paid. Also, 80D of the Income Tax Act allows you to claim a deduction for the premium paid for critical illness. Apart from this, any amount received by the nominee on account of the policyholder's death is exempt under section 10(10D).

Previously, taking insurance policies were possible only through an agent. However, with the advent of time, the policyholders show more interest in direct contact with the company. Hence, modern times are witnessing new methods of investing in any insurance policy. You can apply for a term insurance plan online after comparing the reviews and features of different insurers. The receipt will also come through an email.

There are even online facilities for payment of the premium, and receipt of the maturity or payback amounts directly to the bank account. So, don't worry, much by thinking about your absence. Live your life and protect your family by choosing a suitable term insurance plan. Regular premium payment will open the door for a beautiful future.

**Tax benefits are as per the Income Tax Act, 1961, and are subject to any amendments made thereto from time to time.

Suggested Plans

Bharti AXA Life Flexi Term Pro

  • A Non-linked, Individual, Non-participating Pure Risk Premium Life Insurance policy
  • The plan offers two options: Without Return of Premium and With Return of Premium
  • Under the Without Return of Premium variant, you have the option between Single Life cover or Joint Life Cover i.e., cover for your spouse under the same policy.
  • Flexibility in policy and premium payment terms