Life insurance is crucial to your family's financial security, especially when you are the sole or primary earner. However, not everyone can afford expensive premiums for life insurance policies. Term insurance is an affordable life insurance option in which the nominee will get significant coverage when you meet an unfortunate death within the policy term.

Here are some essential features that the term life insurance plan offers:

• Policy Term: Term policies come with specific periods that could range from 5 to 30 years. The premium cost is affected by the policy term you will select. So choose it as per your requirements.
• Premium: Term insurance plans offer affordable premiums with significant coverage. The premium cost generally depends on your age, lifestyle, health, etc.
• Significant Coverage: The nominee will get an essential and defined coverage amount within the policy term after your unfortunate death. It is generally paid in a lump sum, but you can also select it periodically based on the needs of your family.
• Flexibility: Some term insurance plans allow you to upgrade and modify your policy at a later stage of your life. This factor doesn't even require any medical examination.
• No benefit after maturity: If you survive after the maturity of your policy, you will not receive any benefit from the insurance.
• Tax Benefits: The premium cost is deductible under Section 80C of the Income Tax Act. The coverage amount is also tax-free, as stated under Section 10(10D).

Different Types of Term Insurance Policy Plans

The term life insurance plan is available in different forms. You can choose one as per your budget and requirements:

1. Level Term Plan: In this plan, the premium amount and assured sum will remain the same throughout the term of the policy.
2. Increasing Term Plan: Assured Amount increases periodically, irrespective of premiums.
3. Decreasing Term Plan: The assured amount decreases over time with reduced liabilities.
4. Convertible Term Plan: You can convert your existing policy into an Endowment or whole-life policy at later stages.
5. Return Of Premium Plan: Premium will be refunded if you survive even after the maturity of your policy.

How to Choose the Best Term Insurance Plan?

Generally, when deciding on a term insurance plan, people prefer online to protect themselves from the additional cost of brokers or agents. A term plan can be chosen by considering the following key factors:

• Coverage Benefit: Calculate the coverage amount of the term insurance policy either with the term insurance calculator or by examining the quotes of different companies. Choose accordingly, whichever satisfies your needs regarding future expenses, debts, living standards, etc.
• Duration of Policy: Try to choose a longer duration to minimise your premium cost and financial obligations.
• Riders: Riders are add-ons that provide additional policy benefits. Everyday riders include critical illness coverage, accidental death benefits, disability benefits, etc. Make sure they also increase premium costs.
• Reputation: Check the policy provider’s reputation through customer reviews and satisfaction.
• Ensure Reliability: Check for the policy provider's claim settlement ratio to ensure reliability.

Conclusion

Term insurance is a crucial part of comprehensive financial planning. It provides financial security to your loved ones after your unfortunate death. Using a term insurance calculator, you can estimate the coverage amount you need and the premium costs.