Term insurance is a kind of insurance policy that offers coverage for a specific term or period of years. It is an affordable and simplified policy where in the unfortunate event of the insured’s demise, the benefits are paid to the nominee.
The premium for sum assured of Rs 1 crore for a 40-year-old healthy non smoking male, paid for 20 years is over Rs 800 per month and a little over 9,000 per year exclusive of GST and cesses, wherever applicable. For a smoker, the premium goes up from Rs 800 to 1,000.
For healthy women of the same age who are also non-smokers, that amount comes down further to Rs approximately 650 per month and Rs 7,300 annually over a 20-year term.
The younger you are the premiums drop. If you are a 30-year-old woman with all the other criteria same as the above, your premium is a mere 4,616 annually and Rs 415 monthly.
Two medium sized pizzas even with discounts can cost you Rs 400 at the lower end. If a family were to order pizzas on Friday night, you could easily spend anywhere upwards of Rs 1,000 -- much more than your monthly term insurance premium. And we are talking of one night a week. If you were to order in over two weekend nights, you can pay the premium of your term insurance for anywhere two or three months.
A couple watching a movie over the weekend could mean upwards of Rs 600. Throw in popcorn or a soft drink, and the costs will go over Rs 1,000. If a family of four were to head to the movies at a multiplex, your tickets could be upwards of Rs 2,000 and the snack bill even at a conservative estimate could cost you another 800-100. Now, if you were to buy term insurance for a sum assured of Rs 1 crore, and pay monthly term insurance premium, your one week’s movie tickets could enable you to pay
A basic haircut for women at a good salon costs upwards of Rs 1,000 while a regular manicure and pedicure treatment could cost you another Rs 1,000. Even if you were to choose only one of these every couple of months, you could be spending a fair amount. Throw in nail art or other makeup services from time to time, and you spend even more than your premium for a month.
Even a budget gym with basic facilities in the neighbourhood can cost you more than Rs 8,000 annually. If you choose a more well-known gym, the annual membership can be upwards of Rs 15,000. An annual premium is hardly an issue when compared with the money spent on the gym.
The range of cosmetics one uses can vary from individual to individual but think of all the cosmetics a couple might use and do the math: lipsticks, mascara, eyeliner, nail paint, perfumes, deos, hair cream, gels, et al. A lipstick could cost anywhere upwards of Rs 200 and go beyond Rs 2,000 or even higher. So, even if you buy two cosmetic products in a family of two, you have spent more than your monthly term insurance premium.
Whether you are catching up with your colleagues over coffee, networking with clients or hanging out with friends or family, stopovers at coffee shops happen every now and then. A cappuccino can cost anywhere over Rs 100 at your neighbourhood coffee shop but if you choose one of the bigger international chains, it could be double that. Add a sandwich and the cost goes up further. If you have two-three people with you, you have spent your month’s term insurance premium effortlessly over one visit.
A one-litre pouch of milk could cost upwards of Rs 35. Yoghurt or curd could also be upwards of Rs 50 for a litre, depending on the brand. Even considering you use only one litre of the two, and taking the lowest prices, you could be spending over Rs 2,500 on milk and curd. These two everyday things are consumed by practically everyone and can’t be avoided. Add butter or cheese and prices of dairy can shoot up. A basic cheese chiplets pack of eight cubes could cost upwards of Rs 100, while 500 gm of butter can cost upwards of Rs 225. Now, even if you were to use these two sparingly, costs of dairy will increase by over Rs 3,000. Now think of your monthly term insurance premium and you get the answer!
Term insurance, as depicted in these examples above, is extremely affordable. With an iSelect Star Term Plan, available on Canara HSBC Oriental Bank of Commerce Life Insurance, you can choose multiple options for premium payment including a short tenure, ie, for 5 or 10 years. You can also pick options like whole life coverage, and cover your spouse too in the same policy. There are additional riders that offer greater coverage, including accidental death benefit or child support benefit you could choose from. Pick a plan that’s best for you and keep your family safe!