Written by : Knowledge Centre Team
2026-08-07
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7 minutes read
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Term Insurance is considered the purest and simplest form of life insurance. It helps in making your family financially secure and stable in your absence. A few key traits of a term insurance plan are very clear, such as a low premium cost. However, you should expect more from your term insurance.
If any unexpected things happen, the nominee(s) (as chosen by the person) will get the assured amount of money. Now, with the best term insurance plans, you can have certain expectations. Before that, let's understand the working of a term insurance.
Key Takeaways
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How Term Insurance Works?
A term insurance plan is designed to offer financial protection to your family in case something happens to you during the policy period. You pay a fixed premium regularly, and in return, you get the lump sum amount, known as the sum assured. Let’s break down how it works.
- Choose the Right Policy Term and Sum Assured: You start by choosing a policy term and the sum assured based on your age, income, and future responsibilities. For example, you may select a 30-year policy with a sum assured of ₹1 crore. This amount is the financial support your family will receive in your absence.
- Pay Premiums Regularly: Once you select your plan, you need to pay premiums regularly, either yearly, half-yearly, quarterly, or monthly, depending on the payment option you choose. These payments keep your policy active and ensure continuous coverage for the selected duration.
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- Ensure Active Coverage During the Term: As long as your policy remains active, your family stays protected. If you pass away during the policy term, your insurer will pay the sum assured to your nominee. This payout can help cover day-to-day expenses, loans, education costs, and other financial needs.
- Explore Add-ons and Riders: You can enhance your base plan with optional riders such as accidental death benefit, critical illness cover, or waiver of premium. These riders provide extra protection and financial support under specific circumstances, such as disability or illness.
- At the End of the Policy Term: If you survive the policy term, you usually do not receive any maturity benefit under regular term insurance. However, some insurers offer return of premium plans where the premiums you paid are returned to you at the end of the term.
What Do You Expect From Your Term Insurance Plan?
Here are the seven most useful expectations you should have from your term plan:
- Easily Fits in Your Monthly Budget: One of the key reasons to invest in term insurance is the affordability of the plan. Term insurance is a more cost-effective plan to provide adequate financial coverage to your family.
For example, if you are 30 years of age, a smoker and need to buy a term cover worth ₹. 1 crore, it may cost you as low as ₹ 834 a month or ₹ 10,000 a year. That is perhaps cheaper than the monthly DTH bill for your family.
- Adequate Financial Support for Your Family: With a term insurance plan, the nominee(s) can have adequate financial support for the family after your death. It offers you the highest death benefit with a nominal premium. The best part of term insurance is that you can foolproof your contingency plan with additional covers.
For example, you can add accidental death & disability and critical illness covers to your term plan, for a nominally higher premium.
These additional benefits help your family sail through even when you are hit with a hazardous, life-threatening disease like a heart attack or cancer. The biggest challenge during disabilities and critical diseases is that their income may stop while the expenses pile up. With the additional covers in place, the family can continue to run the household and children's education while you recover from the injury or disease.
- Zero Stress for the Family’s Income after Death: Usually, a generic term insurance would pay a lump-sum amount to your nominee. After that, the nominee must go through the investment maze to secure a regular income for their family. Managing a large sum is difficult enough, let alone the possibility of safely generating a monthly income out of it.
The right term insurance plan can help you plan your family’s future in your absence. It makes life easy for your family by first, making timely claim settlements and by offering you options to convert a part of the total sum assured to regular income for the nominee, disbursed as a monthly amount.
You must check the claim settlement ratio of the life insurer. Canara HSBC Life Insurance has a Claim Settlement Ratio of 99.52%^. This ensures your family can stop worrying about getting a regular income and continue towards their life goals.
- Zero Payment after Retirement: If you opt for a longer coverage tenure beyond retirement, you can choose to pay all the premiums within a short period of time. This limited pay feature is especially useful for you if you have opted for a whole life plan.
With the limited pay option, you can stop paying the premiums much before retirement and continue the cover.
- Leave a Legacy for Future Generations: The whole life option allows you to continue your term life cover till the age of 99 years. That means the policy will benefit your nominees even in the case of natural demise. Thus, providing them with a lump sum and a tax-free estate.
- You can achieve all this at the term insurance cost.
- Covers Your Spouse Too.
It is easy to see the financial contribution of the earning spouse to the family. But the non-earning spouse also contributes a lot to the family. However, it is difficult to put in financial terms, the absence of the non-earning spouse may also result in an increased financial burden.
Thus, the best term insurance plans not only cover the earning member of the family but also the non-earning one.
The term insurance also gives you the option of joint cover. The joint cover implies that both partners are the owners of this policy are covered under the same policy. In case anything happens to any partner, the family doesn’t suffer any financial setback. In other words, with a good term life policy, the homemaker also gets the term cover.
- Upgrade the Cover as You Progress in Life: As life progresses, your financial earning also increases. A majority of life insurance plans offer a good amount of additional benefits. These are also called riders. You can upgrade with covers like critical illness coverage, accidental coverage, and return of premium.
All you need is a small amount for the premium. These riders assure you of a good amount of benefits for your life term insurance. The best part is that they are highly affordable. Adding them doesn’t cause a dent in your pocket.
Final Thoughts
In a nutshell, the family with a term insurance plan gets good financial security in the absence of the earning member. The iSelect Smart360 Term Plan by Canara HSBC Life Insurance can meet all seven expectations above.
Term insurance plans can offer far more than just a comfortable survival for your family after your untimely demise. Term insurance remains the ray of hope for families even when they lose the breadwinner, as owning this policy.
Ideally, the term insurance should offer ‘enough money for your family to sustain their life if anything unfortunate befalls you, it provides adequate cover to you.
Disclaimer - This article is issued in the general public interest and meant for general information purposes only. The views expressed in this blog are solely those of the writer and do not necessarily reflect the official policy or position of Canara HSBC Life Insurance Company Limited or any affiliated entity. We make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability, or availability with respect to the blog or the information, products, services, or related graphics contained in the blog for any purpose. Any reliance you place on such information is therefore strictly at your own risk. You should consult with a qualified professional regarding your specific circumstances before taking any action based on the content provided herein.
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Term Insurance - Top Selling Plans
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