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A life insurance calculator or life insurance premium calculator is a tool that provides an approximate amount of insurance premium according to the policy selected by you and other technicalities like age, policy term, premium frequency, the sum assured, etc. Mostly these tools & calculators are also available on the official website of the insurers. For example, Life Insurance Corporation of India (LIC) has its own life insurance premium calculator on their official website. Usually, you need to fill out the required information which are below mentioned in life insurance premium calculator for calculating insurance premium:
Most of the life insurance premium calculators follow the below steps to calculate the premium of a life insurance plan:
Step 1: The prospective policy buyer should enter the personal details first such as:
Step 2: After the personal details, the policy buyer should enter some of his/her expectations from the policy:
Step 3: It takes only a few minutes to fill the form and after filling all these details, the estimated premium figure will be displayed.
The calculation of life insurance premium is a complicated process and the prospective customers cannot do the calculation by themselves. Calculation of premium is the best for such cases. Let us take the example of LIC premium calculator to understand the premium calculation process through life insurance calculator:
Most of the calculators have four to five fields, which are dependent on your selected plan. Let us take the example of some endowment plan that has a maximum number of fields in it.
Note: The accidental benefit rider gives the additional cover of accidental death by paying some additional premium. This rider is provided by LIC, other insurers may not offer this cover.
Let us see the result of the life insurance calculator:
The common benefits of using a life insurance premium calculator are:
The life insurance premium is one time or recurring payment that a life insurance policyholder makes towards his/her life insurance policy. Any life insurance plan is valid as per the guidelines of the insurance provider and if the policyholder pays premiums on time. Most of the policyholders provide the option of selecting the premium payment frequency like yearly, half-yearly, quarterly, and monthly. The sum assured that a policyholder gets is a factor of this premium that is paid as the sum assured when the policy benefits are activated.
The life insurance policy's premium varies and depends on the plan that one selects and his/her credential. Most of the times, a young and healthy person will get the same life insurance policy in a lower premium than a person who is older comparatively. In the same manner, a person who does not smoke gets better premium rates than a person who is a smoker. Apart from these, there are many other variables that play a vital role in deciding the premium of a life insurance plan, and this is the reason the requirement of life insurance calculator comes in picture.
The rate of life insurance premium is the amount that one has to pay in order to purchase a life cover. There are many factors that decide the premium of life insurance, these factors are: