Here we will discuss the benefits and importance of using a term plan calculator.

Benefits of Using a Term Insurance Calculator

A term insurance premium calculator offers a number of benefits, i.e., from saving time to easy comparison in just a few clicks. Let’s take a look at the various benefits of a term plan premium calculator:

How Does a Term Insurance Plan Calculator Work?

A Term Insurance Calculator works by asking you to fill in your basic details along with the desired life cover. Based on your yearly income, dependents, financial obligations, current lifestyle, and the costs of inflation, you can decide upon a life cover enough to meet your needs. After this, you need to select the kind of term plan you are opting for and enter your age, gender, and the required sum assured.

Using a term insurance premium calculator you can calculate the premiums for different payment frequencies like monthly, quarterly, bi-annually, or annually. Since the calculator makes estimations based on the information you enter, you can make variations within a plan to fit your needs. A term plan calculator uses all this information and estimates the amount you would need to pay on a regular basis as premiums for the required sum assured. The calculator makes all these calculations easily and accurately within a few seconds.

Factors that Affect the Term Insurance Premium Rates

Calculating the best term insurance plan 2023 premium rate is a thorough process that depends on various parameters. As we have discussed above, you need to fill in these details when you use a term insurance plan calculator.

The following factors determine the term insurance premium rate for the policy and must be considered before calculating the premium of a plan using a term insurance calculator:

How To Use Term Insurance Premium Calculator?

Following are the 4 simple steps to calculate the coverage details you need from your term insurance plan:

What is the Human Life Value (HLV) Calculator?

A Human Life Value Calculator gives the amount your family members would need to live their life without any financial difficulties in your absence. It is recommended that you should buy this amount of cover. A human life value calculator takes your annual income, age, and prior investments into account while calculating the amount of life cover appropriate for your family. As per the insurance experts, the term coverage must be at least 15 to 20 times your current annual income.

Human Life Value is the present value of all future liabilities, income expenses and investments. Also, it signifies the economic loss a family would suffer in case of an unforeseen event of your early demise. This HLV number is usually taken to understand how much money would be required to protect your dependent’s lives with a term plan, in case you’re no longer with them.

Let us understand this with an example:

Suppose, you are a 25-year-old male, with an annual income of Rs. 5 Lacs, you will be eligible for a term life insurance plan with a life cover of up to Rs. 1.25 Crore. This means if you buy a term life insurance of Rs. 1.25 Crore, your family will receive this amount in case of your unfortunate death to pay off any existing loans and debts.

How is Human Life Value Important?

How To Calculate Human Life Value?