As a smart investor, we know you would have set long term financial goals for yourself. As a next step, if you are looking to make sure of ensuring a financially secure future for your loved ones, a term insurance plan must be on top of your mind. After all, if you are looking for ideal coverage at a low premium in an instrument that offers simplicity, then there is nothing better than term insurance plans.
So, let us help you delve a little deeper and explore the seven features that make for the best term life insurance plan to help you make the best selection.
- Affordability and features
A key reason why many smart investors choose a term insurance plan is that these plans are affordable. Unlike the investment-based insurance plans, the premium of the term insurance plans is less with higher returns.
However, many times, we may make the mistake of thinking the lowest premium translates to the most affordable plan. This may not be the case, always compare the premium prices viz a viz the features offered for selecting the best insurance plan for yourself. There are certain term insurance plans that offer a cover of up to 1Cr at just Rs 563 per month, could it get any better?
- Regular Income Pay-out Option
The term insurance plan that you choose should offer the ideal phase of support to your family in case of an unwanted event. The sum assured from term insurance is meant to provide financial aid to your family in a time of stress, and thus you need to see whether you want the sum assured to last the family for a very long time or just support them till they get back on their feet, depending on your life stage.
An ideal policy should offer the length pay-out over the time you are looking for. If you are the sole earner of the family, only a single large amount will not do much good for the family. It is important to have a monthly income as well.
Hence you should choose term insurance that can offer different payout formats based on your needs including basic life cover, basic life covers along with monthly income and basic life cover along with incrementing monthly income.
- Maximum Tenure for The Cover
One of the interesting features of the term insurance plans is that you can choose a longer duration than most normal insurance plans. The tenure of the term insurance plan is a crucial aspect, and you should choose a plan that offers the tenures best suited to your requirements.
While earlier, people used to opt for such insurance till the age of 60, the implied age of retirement, now it is possible to buy term plans for more advanced ages, and you should select one that offers this possibility. Some term plans offer cover even till the age of 85.
- Option to Pay Premium for Limited Time
There are certain term plans which offer you the freedom to pay premium only for certain pre-decided number of years and then enjoy the benefit till the coverage term.
If you feel that due to certain life events, it may not be feasible to pay premiums beyond a certain time limited pay option can be a good choice to continue your term cover.
Apart from all the features mentioned above, there are additional benefits various term plans can offer you. See what relevant add-ons are offered by the insurance company that can help customize the plan to suit our needs better. Many insurance companies provide a number of additional benefits with a slight increase in premiums. Such features can add large benefit at lower costs and protect you and your family against a range of uncertainties. These could be:
- Accidental death benefit rider
In this case with an additional premium, if the death happens because of an accident, your family will be paid an additional amount over the sum assured.
- Critical illness
This rider or add-on helps you in covering the medical bills in future. The premium of this add-on is much lesser than the regular medical insurance while the amount is much higher.
- Disability rider
This add on helps you in covering immediate expenses in case your earning capacity is hindered due to an accidental total and permanent disability.
- Hassle free Claim Settlement Process
Claim settlement is the moment of experience with an insurer. Often the person claiming may not be the direct customer of the insurer or as financially savvy as the policyholder. Therefore, it is very important that you check the claim settlement ratio for term insurance. It is the most effective indicator of the ease and speed of claim settlement by the insurer.
Insurance is a must for every person who has a family. It not only provides the peace of mind but also makes sure that when you leave the world, your family will be financially secure. Keeping the above factors in mind will help you choose the best term insurance plan suited to your family’s needs.