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Are There Any Lesser Known Facts About Term Insurance Plan?

Life is full of surprises and uncertainties and surely nothing comes with a guarantee card. Anything can happen at any point in time. Therefore, it becomes important to secure the financial future of the family. And prepare yourself from any unplanned or unexpected emergencies.

Choose a term insurance plan specifically if you have dependents directly. In the present time, with a Rs 30 you cannot buy much, however, it can enable you to build a security net for the family.

Well, the term plan of Rs 1 crore will cover costs as low as Rs 30 a day. Doesn't this sound an exciting deal? The term insurance plan is one insurance product that should be included in your financial portfolio and is the right outright solution. The key highlight of a term insurance policy in India is that it will take care of the financial needs of the family in case of the absence of the breadwinner.

In this article, listed below are some facts that you should know, which are less-known when buying the term insurance policy:

Offers Coverage Up to 85 Years of Age

Most of you might be are aware in regards to benefits of a term insurance plan while it is not much known that you can buy a term plan in your early 20’s but also the late ’50s and take advantages up to the age of 85 years. It is to be noted that a term insurance plan will be on an expensive side at this age, however, you can still cover the potential risk. In the times we live today, people prefer working even after the retirement like till the 60s’.  Today, the term insurance companies offer a plan that provides coverage for up to 85 years of age. Considering the life expectancy in India that is nearly sixty-six years of age, you might get a cover for 85 years of age it will make it the whole life product.

Term Insurance is Real and Not a Gimmick

The various life insurance products such as a ULIP, money back plans, endowment plans are investment-linked plans and the term insurance plan is one pure life insurance product, which covers the life sufficiently and proves to be a reliable financial support for the family in case of the absence of the primary earning member. Therefore, if you are looking forward to buying the right life insurance for the apt reason that is with the prime intent of social security and protection, then a term insurance plan in India is the right product to buy.

Rejection of Claim Could be Due to False Disclosure

While buying a term plan you should not hide any information in regards to the lifestyle or any pre-existing ailments if any. People tend to hide prominent information to avoid higher term insurance premiums. Besides, most people do not disclose the important information of consuming tobacco just to avoid higher premium as mostly it gets increased by 25 per cent to 50 per cent specifically when you consume tobacco frequently or is already suffering from any of the chronic illness. When it comes to settling the term insurance claims, the insurance company will properly investigate and go through all the insurance-related documents and medical history. If any fact is found to be incorrect or false then it will lead to rejection of the term insurance claims.

Sum Assured is Limited to the 20x of the Income

It is a task to determine an adequate sum assured for the family to cover the regular expense in case of the untimely demise of the breadwinner. The ideal sum assured will be on the premise of the monthly expenses and yearly income. When it comes to deciding a sum assured to make sure to take into consideration the aspect of inflation. Most likely it ideally should be fifteen to twenty times of the yearly income. On the premise of it, the insurance companies have capped a maximum sum assured to the 20x of the yearly income. For instance, if you are earning every year a sum of Rs 5 lakh then you might not be able to buy the term plan that is beyond Rs 1 crore cover.

Sum Assured Can be Increased During the Policy Course

The life of a person changes whenever they move from one stage of life and enter the other. Well, the various phases of life mean constant changes in the spending patterns and the overall expenses specifically in terms of a marriage. The shifts could be insured at different stages of life with protection feature that would help to adjust with the changed lifestyle and the financial circumstances at every important milestone in the life upon paying the extra premium amount. You can easily increase the sum assured at the key milestone of the life namely marriage, entering parenthood and becoming parents again with an increment of 50, 25 and then 25 per cent respectively.

The Bottom Line

You will never want to put the financial security of the family at risk or want to see them facing any financial hardship or struggle. Therefore, make a smart decision and buy the best term insurance plan in India. The corpus of the term insurance plan is not directly linked to the market and you will be aware in regards to the sum assured amount during the time of purchasing the term insurance plan online.

Written By: PolicyBazaar - Updated: 23 February 2021
Disclaimer: Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by an insurer.
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