Research suggests that people give preference to the life of their family members over their own. That is why, survival for your family if anything untoward befalls you, may bind your head into a spiral of worries.
Well, you can work hard, accumulate a lot of money and give your loved ones the best possible life and future. However, you will only realise that when you have achieved the said milestones. And while you are at it, nothing liberates you better than a good term insurance plan. It’s not simply about the life cover, as you very well know, even a large sum of money brings its own share of troubles.
The best term life insurance offers much more than just a large sum of money to your dependents and you. Here’s a list of traits the best term life insurance will offer that will give you a sense of freedom.
1. Adequate Cover
A few demands you will have from a term insurance plan are:
Untimely death is not the only risk you should protect against. Life-threatening illnesses like cancer and accidental disabilities can also have a potentially devastating effect on your family’s financial health. Thus, the best term plan should not only protect them from your untimely death but also from critical diseases and accidental effects.
2. Cost That Doesn’t Pinch Your Budget
Term insurance plan can offer adequate financial protection at nominal prices.
For example, if you are 30 years of age and a smoker your annual income is Rs. 10 Lakh, you can get a term cover of Rs. 1 crore at an annual premium of approximately Rs. 10,000. That comes around Rs. 834 per month. Perhaps, less than your monthly DTH bill.
3. Freedom from Income Worries
Now you can choose monthly income pay outs along with the one-time lump sum payment. Managing a large sum of money is a challenge many struggle with and safely generating regular income from it is an even bigger challenge.
Of course, you would want to avoid leaving your loved one with such challenges if anything untoward happens to you. Therefore, term insurance plans like Canara HSBC OBC Life’s iSelect Star offer a monthly cash in-flow along with lump-sum payment.
For example, you can choose to give 50% of the sum assured as lump-sum while converting the rest into monthly income for the nominee. You can even choose a growing monthly income to take care of the inflation.
4. Freedom from Office Visits & Maze of Paperwork
In the era of e-commerce, it would be ridiculous if you still have to run from pillar to post with a bundle of papers; that too for something as essential as term insurance. Best term insurance plans are now available online.
At the max, you may need to visit the nearest authorised clinic for a health check-up. But that will again, only benefit you as you get a free health check-up. Rest of the documentation happens online, so you can buy the policy from the comfort of your home, especially during this desperate time, when staying at home has become the top priority for us.
5. Claim Settlement as Quick as a Wink
Best life insurance providers nowadays leverage technology to offer faster claim settlement so that your family doesn’t have to wait a long time or stress about the claim while grieving.
For example, Canara HSBC OBC Life offers to settle a term insurance death claim within 24 hours if it is below Rs. 1 crore. Otherwise, claims larger than Rs. 1 crore may take up to 5 working days. (That is provided the claim meets the conditions for fast settlement and all relevant documents have been submitted.)
This is quite an improvement from the usual 30 to 90 days claim settlement period.
6. Freedom from Taxes
The premium you pay for your term insurance cover reduces your tax liability under section 80C. Any payments your family may receive from the life insurance policy after claim is also tax free under section 10(10D).
7. Freedom from Premium Payment
You can think of two types of freedoms from premium payments:
A good term plan should offer both options. If you don’t want to bother about paying premiums for many years, you should have the option of a one-time payment. However, if you are salaried you can also choose to autopay the nominal premium amount from your account every month.
Compare Term Plans Before Buying:
As you can see, buying a term plan is not enough, since there are many other features to make your family’s life easier. It is always good to compare term plans and make sure you can have the most freedom at the end of it.
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The premium is one of the most important factors to consider before buying a life insurance policy. Many people buy a life insurance policy with a high sum assured but are unable to process the premiums for the entire premium payment tenure. You can get a better idea of the premium outgo with the premium calculator available in the 'Tools and Calculator' section of www.canarahsbclife.com.
Life insurance plans come with several riders which increase the efficiency of the policy for the buyer. For instance, if you have a history of terminal illness in your family it would be advisable to opt for terminal illness rider with your term insurance plan. Riders or add-ons help in customising the standard policy benefits for the requirement of different families. The iSelect term insurance plan comes with a built-in cover for terminal illness, and option for protection against accidental death or disability. You can also opt to cover your spouse's life under the same policy by paying an additional premium.
Life insurance companies calculate the premiums based on several factors such as age, gender and occupation.
Age: It is one of the biggest factors that influence life insurance premiums. Premiums tend to be low when the life insured is younger as the chance of contracting diseases is low. Young people also opt for the best life insurance policies with longer tenures and pay premiums for a longer duration, which makes the policy cheaper for young people.
Gender: The insurance premium for women is generally lower when it comes to life insurance plans. Women live longer and pose a lesser risk of a claim leading to lower premiums for them.
Lifestyle habits: The premiums for people who smoke or drink is always higher due to higher health risks.
Policy term: Policy terms are also taken into consideration by insurers while deciding the premium amount. Life insurance policies with longer tenure are cheaper as compared to short-duration policies.
Mode of purchase: The platform that you use to buy the best life insurance policy also determines how much you will have to pay for the plan. People who buy life insurance policies online have to pay lower premiums as compared to offline policies.
Occupation: The nature of your work is an important factor that influences the premium amount. Certain occupations like shipping and mining are considered more dangerous as compared to jobs in services industries. The insurance premium rises with the risk profile.
Processing life insurance claim is a transparent and smooth process with Canara HSBC Oriental Bank of Commerce Life Insurance.
In case of the death of the life insured, the nominee will have to intimate the company by filling a Death Claim Form and sending it to the nearest branch office.
Once the form is received, the claim is registered by the insurer.
After the registration of the claim, the company will send the claims pack along with the related forms such as physician’s statement form and employer certificate that need to be filled.
Along with the duly filled forms a few documents such as original [policy document, death certificate, copy of bank passbook, hospital or treatment records, photo identification and address proof have to be provided.
The claim is processed on the submission of relevant documents. Once the documents are verified, the claim amount is released post all due diligence.
Household expenses rise with age. The cost of children's education increases along with other lifestyle expenses. The iSelect term plan offers an option to increase the cover according to the life stage. If opted, the insurance cover increases by 25% at every 5-year terminal till the 20th policy year.
Even though a life insurance policy is bought to protect your family in your absence, there are chances of the claim being rejected due to several factors.
False information: If the policyholder provides false information or conceals important information while buying the life insurance policy, the insurer has the right to reject the claim after his/her death.
Type of death: Deaths due to suicide in first policy year, intoxication or pre-existing disease is not covered under life insurance plan.
Premium payment: The payment of premiums on time is of utmost important to avail the benefits of life insurance. Life insurance policy may lapse on the failure to pay the premiums
Nominee details: A life insurance company can put the claim on hold if the nominee details have not been filled or not been updated by the policyholder.
Buying the best life insurance plan online is not only safe but a better option. Online life insurance policies have lower premiums and the individual is not required to visit the insurer's branch or a bank. The best life insurance policies online insurance offer higher benefits. Customers should, however, buy online life insurance policies only from credible insurers and should check for SSL certificate on the website to ensure that the website is legitimate.
The cost of life insurance policies varies depending on factors like age, gender and occupation. The average cost of life insurance plans, especially term plans, is very low compared to the amount of coverage offered.
An individual is allowed to have multiple life insurance policies. People opt for more than one life insurance policy to increase the cover or avoid claim rejection. In case of multiple life insurance policies, even if the claim is rejected by one insurer, the beneficiaries may receive the benefit from a different insurer.
Life insurance policies are of different types. In case of unit-linked or endowment policies the policyholder receives the maturity benefit at the end of the policy term. However, in the case of term insurance plans, there are no maturity benefits. The death benefit is only paid out after the death of the life insured.
When you buy a life insurance policy, the insurance company asks for the nominee details. Only the person named as the nominee in the life insurance plan can cash out in case of death of life insured.
A life insurance policy is generally taken for a specified period. After the policy duration of a term plan gets over, the policy simply terminates and ceases to exist. However, in case of unit-linked plans or endowment, you can use the policy as a tool for retirement planning and the accumulated corpus is used by the insurer to pay you monthly amounts for your entire life.
If a policyholder purchases a term plan for 25 years and dies during the policy term, the beneficiary receives the death benefit. In case of iSelect term plan, the policy provides four payment options to the beneficiaries. If the regular payment option is chosen, the policy works as a source of regular income.
It is a popular misconception that life insurance plans are only for accidental deaths. A term life insurance plan like iSelect Star Term Plan also covers terminal disease along with death. A terminal illness cover is important as health insurance pays only for the cost of treatment and hospitalization, but a terminal illness cover pays you a lump-sum amount which takes care of other expenses. On the other hand, unit-linked policies such as Invest 4G cover death and also provide decent returns for other financial goals such as buying a house of child's education.
It is ideal to buy a life insurance plan in your early 20s because it is the time when people have just started with their professional life and so there are lesser responsibilities and financial liabilities to take care of. Also, if you buy the best life insurance plan at this age, you will be paying relatively lower insurance premiums since it’s a due fact that mortality rate in case of young people is low. And that is why life insurance companies offer lesser premium rates to younger people as they think that they are most likely to be fit and healthier with less chances of filing a claim in future.
Once you have cancelled your life insurance policy, you will instantly lose your life insurance cover. Afterwards, your insurance company will get in touch with you and ask for valid reasons regarding the cancellation of your policy. In case you cancel your life insurance policy within the grace period, i.e. 15 to 30 days, depending on your insurer, then insurance company will reimburse the premium amount paid by you. But, no refunds will be paid to you if the policy is cancelled after the grace period.
Yes, you can take life insurance under Married Women’s Property (MWP) Act, 1984 only if you are a married man and a resident of India. Buying a life insurance plan under MWP Act would be helpful in saving your family’s financial well-being when you are not around. As per this policy, only wife and children would be eligible to receive the death benefits. You can also buy a policy if you are a widower or a divorcee. However, in that case, you can give your child’s name as your beneficiary. It is very simple to buy a life plan under MWP Act. All you need to do is to fill up an MWP addendum while purchasing an insurance policy.
Yes, there are different payment options for you to pay premiums. Here’re some of them
1. Regular premium payment option – This premium payment option allows you to pay premiums equal to your policy term either monthly, quarterly, half yearly or annually.
2. Single payment option – Through this premium payment option, you can pay the lump-sum amount in one single payment.
3. Limited payment option -In this premium payment option, you can pay premiums for a specific period of time less than policy term either monthly, quarterly, half yearly or annually, but benefits of insurance can be enjoyed for a longer period of time.
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