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7 Things to Expect From Your Term Insurance Plan

7 Things to Expect From Your Term Insurance Plan

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Term Insurance is considered as the purest and the simplest form of life insurance. It helps in making your family financially secure and stable in your absence. Few traits of a term insurance plan are very clear, such as low premium cost, however, you should expect more from your term insurance.

However, at any juncture, if the insured passes away, 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. Here are the seven most useful ones you should have from your term plan:

choosing a term insurance

1. 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 cover to your family.

For example, if you are 30 years of age, smoker and need to buy a term cover worth Rs. 1 crore, it may cost you as low as Rs. 834 a month or Rs. 10,000 a year. That is perhaps cheaper than the monthly DTH bill for your family.

2. Adequate Financial Support for Your Family

With a term insurance plan, the nominee(s) can have adequate financial support for the family after the insurer's death. It offers you the highest death benefit with a nominal premium. The best part with term insurance is you can fool proof 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 your 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.

3. Zero Stress for Family’s Income after Death

Usually, generic term insurance would pay a lump-sum amount to your nominee. After that, the nominee must navigate the investment maze to secure a regular income for her and 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 look for the claim settlement ratio, which is usually a percentage, like it is 98.12% for Canara HSBC OBC Life Insurance. This ensures your family can stop worrying about getting a regular income and continue towards their life goals.

4. Zero Payment after Retirement

If you opt for a longer coverage tenure stretching 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.

5. 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 case of natural demise. Thus, providing them with a lump-sum and tax-free estate.

You can achieve all this at the term insurance cost.

6. Covers Your Spouse Too

It is easy to see the financial contribution of earning spouse to the family. But the non-earning spouse also contributes a lot to the family. However, difficult to put in financial terms, absence of the non-earning spouse may also result in 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 both the partners are the owner of this 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.

7. 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 a good amount of benefits for your life term insurance. The best part is they are highly affordable. Adding them doesn’t cause a dent to your pocket.

In a nutshell, the family with a term insurance plan gets good financial security in the absence of the earning member. The iSelect Star term plan from Canara HSBC OBC Life can meet all the seven expectations above.

Term insurance plans can offer far more than just a comfortable survival of your family after your untimely demise. Term insurance remains the ray of hope for families even when they lose the bread earner owning this policy.

Ideally, the term insurance should offer ‘enough money for your family to sustain their life if anything unfortunate befalls you. And it should do so without pinching your pockets while you are alive & well.’

Speak to an insurance specialist now!

Frequently Asked Questions (FAQs) for Term Insurance Plans

A person can only purchase a term insurance plan till the age of 65 years, and they can choose the risk coverage for up to 99 years of age. One can easily buy the best online term plan between the age of 18 to 65 years.

This being a term insurance plan doesn't offer any payout after maturity or expiration date

Each insurance company has its own term insurance premium calculator. If you want to check out the premium quote, go for the iSelect Star term plan calculator. It gives a premium amount based on your age, gender, habits, education, and annual income.

You can purchase an iSelect Star term plan anytime between 18 to 65 years of age. This is a term plan with return of premium option – that means all the premiums paid throughout the tenure will be paid back to you if you outlive the policy.

It depends on your needs. For example, if you want to cover a child's education or wedding expenses, you have to include them in your coverage. Your premium will be calculated accordingly when you buy the best term plan in India.

If your key purpose is to give your Family financial protection, go for the best term insurance plan. And if you want some savings, in the end, go for a traditional life insurance plan. iSelect Star is a term plan with return of premium option. All the term insurance premium will be paid back to you, if you outlive the policy term.

Go for at least 12 times cover than your annual income. Or you can go as far as 20 times coverage as per your needs.

The right time is when you don't have anything to keep your Family safe from financial storms, and they rely on you for financial needs.

If you are unable to make the payment or suffering from a terminal illness, the best term insurance plan pays a part of the sum insured to treat your disease.

Term life insurance plan riders are attachment or endorsements made, while taking the term insurance policy, as a supplementary coverage to policyholders. Apart from the core death benefit, term insurance plan riders offer below-given additional benefits:

  • Accidental Death Rider When a person suffers from a terminal illness, his/her family ends up spending a significant amount in treatment and medical expenses. Accelerated death rider pays a part of the sum insured in advance to cover such costs and save the family from running out of cash.
  • Accidental Disability Rider If the policyholder can't pay the premium because of an accident or permanent disability, a sudden disability this pays the premium on behalf of the policyholder till completion of policy term or for a defined duration.
  • Critical Illness Rider If the insured person gets a heart attack, cancer, or any other critical illness, this rider pays a lump sum on valid diagnosis.
  • Premium Waiver Rider If the policyholder is unable to make payments due to income loss or disability, a premium waiver rider waives off all future premium payments. And the term insurance policy remains active until the expiration date.
  • Income Rider: This rider in a term insurance plan ensures that your family receives regular income + sum insured in case of unfortunate demise of life insured.

Anyone can go for life insurance as it offers some savings after the maturity date, but it doesn't cover the protection of your family . The best term insurance plan is solely designed for taking care of loved ones if something happens to you. Term insurance plans act as a shield between your family and sudden financial fall. They make sure that your family lives a healthy life even after you. With a little amount paid per year, you can be worry-free from the family's financial conditions.

Questions that you need to ask while Buying the Best Term Insurance Plan?

  1. 1. Are you buying a term plan with return of premium?
  2. 2. Amount of premium you have to pay based on your age, habits, education, and monthly income
  3. 3. The total number of benefits covered in the term insurance plan. Do they include benefits that you care about the most?
  4. 4. How to save money on tax if you pay for the term life insurance plan?
  5. 5. Do they offer regular income options?
  6. 6. Can you change the coverage and premium in the future?
  7. 7. Does the claim consider valid if death occurs outside India?
  8. 8. Which kind of death is not covered by a term insurance plan?
  9. 9. Can NRIs take a term insurance plan? If yes, what are the conditions?
  10. 10. Does the term insurance plan have a cash value if you decide to cancel the term insurance policy?
  11. 11. Under what circumstances can a term insurance plan be cancelled?
  12. 12. Can I pay the premiums online or make electronic payments?
  13. 13. What will happen to the term life insurance plan if the life assured starts smoking after purchasing the policy?
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