5 Tips you Need to Buy Best Term Insurance Plan

We all know that life is full of uncertainties. So, investing in the best term insurance plan can act as a cushion for your family’s financial security again such uncertainties.

A term insurance plan is referred to as pure life insurance plan. It covers the policyholders for a certain period in return for a specific amount of premium paid by them. A term plan also provides death benefit to the nominee if the policyholder passes away during the term period specified in the policy.

Why Should You Invest in the Best Term Insurance Plan?

One of the main reasons to buy a term insurance plan is that you can secure your loved ones even in your absence. The financial needs your family like your child’s higher studies, marriage, any kind of emergencies, will be fulfilled when you are not around them anymore.

The lump sum payout will be offered by a term insurance plan to your family which can be used to clear various liabilities like loan payment. The amount can also be used to meet their regular expenses and long-term goals in case of your sudden death due to unforeseen circumstances.

Benefits of Buying a Term Insurance Plan

There are several advantages of investing in the best term insurance plan. Here are the most important ones.

  • The term plans come at significantly lower premiums than the whole life insurance policy. The entire premium paid towards it covers the risk of unexpected losses.
  • You can receive higher coverage amount for a long term age at extremely low premiums.
  • You are also allowed to choose the frequency of the premiums. You can either pay premiums at once or at regular intervals throughout the policy term.
  • A term insurance also provides tax benefits. The premiums paid towards term insurance plan are tax exempted under Section 80C of the Income Tax Act, 1961. Additionally, the death benefit received by the nominee is also tax exempted as per Section 10(10D).
  • You can buy a term insurance plan online or offline as it is easily available. It is always advisable to buy a term plan online, as it is a simple and cost-free process. 

5 Tips to Consider Before Buying a Term Insurance Plan

Before buying a term insurance plan, the investors usually get confused about what is the best term insurance plan for them. Here are some of the factors which can help you to select the best term insurance plan provided by different insurance companies.

Look For The Highest Coverage

The term insurance plans are known for offering the high coverage as compared to any other life insurance product. It provides you coverage in the form of a death benefit to the nominee of the policy. Thus, it is always advisable to choose the insurance plan which can provide you coverage that is very high than your annual income. It will help you to choose a term plan with a high sum assured amount.

Compare Various plans

The term insurance plans are considered as one of the most affordable life insurance products. However, people often make the mistakes of buying the wrong term plan. Thus, it is very important to compare various term insurance plans online. By doing this, an individual can choose the most comprehensive plan at a lower premium rate.

Check Rider Benefits

An individual must choose a insurance plan which offers rider benefit. Riders are add-on covers offered by the              term insurance plan to increase the coverage of the policy. So before buying in term plan, make sure to check riders offered under the policy.

Purchase the Plan Online

Online mode provides many benefits to the policyholder as compared to the offline mode. The online process of purchasing a term insurance plan is not only simple but also it saves a lot of time and money. There are many insurance companies that offer premium discounts for online buyers. It will also help buyers to check creditability of the insurance provider and make an informed decision.

Check Claim Settlement Ratio (CSR)

The claim settlement ratio (CSR) is one the most important factors that should be considered while purchasing the best term insurance plan. It refers to the total number of claims settled in a year by the total number of claims filed in a year. It is advisable to choose the insurance provider with a higher claim settlement ratio as they are more reliable.

Conclusion

There are various term insurance plans available in the market, but it could be a hectic task to choose the best one for you. It is always essential to compare insurance types online and then purchase the best suitable plan for you.

The term insurance plan can provide you sufficient coverage at a lower premium rate. However, it is necessary for you to first analyse the requirement considering the factors and then choose the best term insurance plan as per your requirements and suitability.

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