Given the current scenario, investments and securing your financial future has become crucial. One of the insurance that has been quite a talk of the town and performing exceptionally well is the term life insurance policy. Known for its low premiums, this insurance policy has much more to offer than what meets the eyes.
What is the term plan?
To put it simply, a term plan is a protection plan which offers you a cover to protect the financial future of your family.
This is one of those rare insurances that comes with types under its umbrella. So, before you zero down on a particular term life insurance policy, let’s take a look at its various.
Pure term plan:
Perhaps one of the most advised and commonly purchased term life insurance policy. As the name suggests, this plan is exactly what a basic term plan is all about. In this plan, the premium and the life cover (sum assured) that you opt for remains constant throughout the tenure of the plan. In case of your demise, the benefit is paid to your nominee. Conversely, if you survive in your term, you don’t receive anything, as per the format of term life insurance.
Premium plan return:
Another type of term insurance policy in India includes the premium plan returns. Here, unlike the standard term life insurance policy, if you survive till the maturity of the policy, you will receive returns. These returns are paid from the premiums that you have paid over the years. However, if you pass away during the policy’s term, then your nominee will receive the sum assured.
Increasing term insurance:
This term life insurance policy is the one which offers death benefits, gradually. Generally, the death benefits increase every year, during the policy’s term. However, the premiums of this policy do not increase. You may come across some plans which may have a limit on the maximum possible sum assured. But, the increase in coverage amount will come to a halt once it touches the limit. However, the plan will still be effective.
This term life insurance policy is specially designed to offer cover and combat the effects of inflation and/or changing market trends. The increasing term insurance plans are a tad more expensive as compared to the other term plans.
Now that you know the various types of term life insurance policies in India ensure you pick the best one for you. A bit of research on what each plan entails in detail can help you choose the apt plan.