Term Insurance Calculator
A term insurance calculator is a specifically designed tool, which helps you to calculate the required monthly premium in order to get the desired sum assured amount. This calculator is simple and extremely helpful when you are planning to buy a term insurance plan. Term insurance premium calculator allows you to adjust the sum you would want your family to receive post your unfortunate demise.
What is Term Insurance Calculator?
Term insurance premium calculator helps you determine the actual premium which you may need to pay to the insurer. As there are so many insurance companies offering policies in India, term insurance calculator facilitates easy comparison of various plans and thus, allows you to choose the best insurance as per your needs.
Secure your family’s life even when you are not around. There are many online term insurance premium calculators to compute e-premium that are required to pay by an individual in order to buy a term plan. You can also customize this calculator at your own convenience.
Types of Term Insurance Calculator
In order to cater to the requirements of the insurance seekers, there are different types of premium calculators available in the market. Let us take a look:
Term Insurance Premium Calculator:
This term insurance calculator helps you compute the premium that you need to pay at a specific age for a specific coverage that is required by you.
Investment Plan Premium Calculator:
This term insurance calculator helps to analyze your investments in an insurance policy and gives you growth projections.
Pension Plan Premium Calculator:
This term insurance calculator helps you compute how much you need to invest today to earn the desired amount of steady pension in your retirement years.
Child Insurance Premium Calculator:
A child plan premium calculator helps you to analyze and compute how much money you have to pay to get adequate funding for your child for education, marriage, and other miscellaneous expenses.
Benefits of Term Insurance Calculator
A term insurance calculator is what you may need if you are on the lookout for the right plan. It will help you to do the comparison and figure out the best term insurance plan that can match your needs. Some of the major benefits offered by term insurance calculator are detailed below-
- Time-Saving Technique: The term insurance premium calculator helps you in saving your precious time. You are not required to submit any hard documents to get premium quotes. In less than 2 minutes, it will suggest an apt term insurance plan that fits within your needs. Once you have figured out a plan, you can buy it online also without the intervention of agents.
- Comparison of various plans: Term insurance calculator is the only tool available in India providing an option to compare term plans offered by different insurance companies on a single platform.
- Cost effective: There are so many companies who prefer to deal with their customers online. They offer exciting discounts to people who buy insurance online. So once your term insurance premium calculator unveils good plan options, you can do a comparison and buy any of them online to save extra bucks.
So make judicious use of term insurance premium calculator because the time which you spend on making wild guesses regarding your premium is much longer than two minutes which you may need for filling all requisite details while using term insurance premium calculator. It is not only a fast and easy tool of comparison but most importantly it is accurate.
How to use the Term Insurance Calculator?
Filling out information in term insurance calculator and getting premium quotes will not take more than 10 minutes. Here is how you can use the calculator in 3 simple steps:
Step 1: Enter your personal information like date of birth, gender, marital status, annual income, number of children you have, life cover, etc. You may also be asked about your smoking habits.
Step 2: Then you will need to enter how much sum assured you want and for how many years. You would also need to clarify how you would like your family to get money- one-time lump sum amount or monthly income. Simply hit and wait for results.
Step 3: The term insurance premium calculator will recommend some good term insurance plans in accordance with the details you have filled above. Make a systematic comparison. Choose the best term insurance plan and proceed to buy.
Calculate accurately and compare easily by using our term insurance calculator to avoid any ambiguities at a later stage. Buy the plan of exactly the amount that you will need in the future. Future planning is now just 3-steps away.
How to Calculate Term Insurance Premium?
In simple words, life insurance plans provide financial protection to the family, in the event of the decease of the insured. Besides this, life insurance policies also work as a saving instrument, retirement fund, endowment plan, investment plan, etc. Moreover, life insurance plans also come with the perk of tax benefit.
As having a life insurance policy is very important for paying the premium of the policy is equally important in order to avail the continues benefit of the plan. The policyholder can pay the premiums of the policy in different modes like monthly, half-yearly, quarterly and yearly. The policy buyers can make use of the life insurance calculator in order to get the approximate premium rate of the policy.
The premium rate of the policy is determined as per the chosen plan and according to the credentials of the applicant. Generally, the premium rate for young insurance buyers is less as compared to the person who is in his/her 50s. This is because young buyers are considered healthy and tend to pose less risk to the insurance company as compared to the aged insurance buyers. Moreover, there are many different factors that determine the rate of the premium of the policy.
The insurance seekers can make use of the term insurance calculator in order to avail the most beneficial plan at an affordable premium rate. However, while using the premium calculator the policyholders are required to provide the following information.
- Applicant age
- Plan Name
- Premium Frequency
- Sum assured
- Gender
- Tenure
- Date of birth
- Rider
- Proposer’s name
After entering these details, the insured will get the approximate premium amount.
Factors to Consider Before Calculating Term Insurance Premium
The following factors must be considered before calculating the premium of term insurance plan:
- Your Insurance Requirements: The first factor that plays a vital role in deciding the premium through term insurance calculator is your insurance needs or your requirements from your selected insurance plan. Different term insurance plans cater to different needs of the policy buyers. Therefore, according to your stage of life and goals, select a plan that will enable you to achieve your future financial goals.
- Your Age: They say ‘The earlier you start the lesser premium you have to pay for your term insurance plan’. Age is another important factor to calculate the premium of your term insurance plan. Generally, a term insurance premium calculator calculates a lesser premium for people of younger age. So, start a term insurance plan early and maintain a low-cost insurance cover for a longer period of time.
- Your Coverage Amount: The coverage amount of your term insurance plan is another factor that life insurance calculator takes while deciding the premium. You should select a term insurance plan according to your future needs and the rate of inflation. The amount that is sufficient for you and your family currently may not be enough in the future, so select the coverage amount wisely.
- Your Gender: Even though they say all women and men are equal, but as per the data of life insurance providers, women live a longer life than men. Therefore, through term insurance calculator the premium is lesser for women than for men of the same age.
- Your Selected Policy Term: Policy term also plays an important role in term insurance calculator for calculating the premium. The longer the duration of the policy the lesser premium you have to pay. Therefore, a term insurance plan with longer duration is cheaper than a term insurance plan taken for a shorter duration.
- Purchase Online: Buying a term insurance plan online is not only simple and convenient but also cheaper. The reason for the same is no involvement of the intermediaries.
- Your Occupation: Some occupations like working in the industry, shipping, fishermen, miners are considered dangerous than working in an office. Therefore, people in these occupations may need to pay higher premiums. However, a life insurance premium calculator considers other factors as well, thus it varies with individuals.
Term Insurance Premium Payment Options
The frequency at which the renewal premiums are payable is called the premium payment frequency. The Term Insurance Premium Payment Options can be annual, half-yearly, quarterly and monthly.
The insurance buyers can determine the premium rate of the policy with the help of term insurance calculator. Insurance companies give a variety of Term Insurance Premium Payment Options to their customers to pay their premium on time. Some of the Term Insurance Premium Payment Options are as follows:
- Walking into the insurer‘s Office and making payment by Cash / DD / Cheque, Credit Card, Electronic Clearance System, or Direct Debit
- Walk into any Bank Branch Partner of the Insurer
- Online payment through net banking and bill junction
- Electronic Clearing Services (ECS)
- Standing Instruction to your bank
- Payment through Bill Desk
- Electronic Bill Payment
- Payment through Visa Bill Pay
Term Insurance Premium Rates
Term insurance premium rates determined by the term life insurance premium calculator are the cost that you pay for buying an insurance policy. It is calculated by specialists known as actuaries. These term insurance premium rates should be adequate and equitable to payout the policy benefits and depend on the degree of risk covered by the company. Term insurance premium rates are governed by the following factors:
- Mortality Rate: It is an insurer’s anticipation of deaths amongst a particular group of insured lives at a certain age.
- Investment Earnings: Premiums are the primary source of funds used to pay term insurance claims. Because most policies are in force for some time before they become payable, insurance companies have premium to invest. The earnings from these investments provide the company to charge fewer premiums.
- Expenses: A term insurance policy's gross premium is calculated by term insurance calculator as net premium + loading. The net premium depends on the mortality rate, investment earnings, and the lapse rate and loading are the company’s operating costs.
Written By: PolicyBazaar - Updated: 06 August 2019
