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All about Spouse Term Insurance Plans

All about Spouse Term Insurance Plans

Spouse term insurance plans

As the name suggests, a spouse term insurance plan allows you to include your partner/spouse under your term plan coverage. This way, the same life insurance policy will protect both you and your partner against life’s uncertainties. Moreover, a spouse term insurance plan is a tailor-made life protection instrument not only for working couples but also for those where one spouse is a homemaker.

The financial protection of a spouse term insurance plan is primarily useful to cover non-working partners, who cannot opt for a term plan easily on their own. That said, having spouse term insurance cover makes it easier to track premium payments, policy benefits and claim settlements under a single policy, instead of two separate plans. Here, we look at various features and benefits of spouse term plans to help you make an informed decision.

What is a Spouse Term Insurance Policy?

As it plainly suggests, a spouse term insurance plan provides the protection of life insurance coverage to both partners (husband and wife) under a single policy. A spouse term insurance plan offers various features and benefits including tax saving benefits, discounts on spousal premium payments, long-term policy tenure and regular monthly income payout to the surviving spouse.

Under a spouse term insurance plan, you can also opt for additional protection through critical illnesses, permanent disability, accidental death and dismemberment riders.

Key Features of Spouse Term Insurance Plans

While buying a spouse term policy, the primary policyholder (i.e. you) need to be an earning member of the family. Mostly, the maximum sum assured applicable under a spouse term insurance is either a specific percentage or a fixed amount of the primary policyholder’s applicable sum assured.

Benefits of Spouse Term Insurance Plans

Benefits of Adding Your Spouse Under The Same Policy

In most cases, a spouse term insurance plans costs comparatively lesser than purchasing two separate term insurance policies (also, it may not be possible to purchase a separate term life cover for a non-working spouse). Another advantage of a spouse term insurance plan is the availability of the waiver of premium feature. If your spouse term insurance offers death benefit payout on the demise of the working partner, the non-working spouse will receive lump sum payment of death benefit, while the waiver of premium feature will waive off any remaining premium payments and help continue the life coverage for the surviving spouse. The premium payable under spouse term insurance plans is also eligible for tax deductions under Section 80C of the Income Tax Act 1961, while the amount received upon the demise of either partner is tax-exempt under Section 10 (10D) of the Act.

When Should You Buy a Spouse Term Insurance Plan?

Buying a spouse term insurance plan is ideal for nuclear families, wherein both spouses are working and have financial debts to pay. With a spouse term insurance plan, the policyholders can protect their family against death and disability of either earning member, while lightening the financial burden with the help of the insurance payout. Young parents having outstanding loans should also opt for a spouse term life insurance policy to make sure that their children remain protected against any future mishaps.

The sum assured payable under a spouse term insurance plan is calculated after assessing the age, annual income, health and lifestyle of the primary policyholder. For the spouse or the secondary policyholder, the insurance company may only ask for the verification of age and highest education. There may also be no need to conduct any medical test for life insurance, in case of spouse or secondary life assured. The employment status of the secondary life assured or the spouse does not matter while buying the spouse term insurance plan.

At Canara HSBC Oriental Bank of Commerce Life Insurance, we provide term insurance protection for spouses under our iSelect Star Term Insurance Plan (An Individual Non-Linked Non-Par Pure Risk Premium Life Insurance Term Plan, UIN: 136N072V01). Under iSelect Star Term Insurance Plan, you can opt for a life cover extending over a lifetime and also enhance the coverage through additional in-built benefits such as Accidental Death Benefit, Accidental Total & Permanent Disability Benefit, and Child Support Benefit. At the same time, you can add your spouse (both working and non-working) to the policy, while availing of a discount on the premium rates for the Spouse. As primary policyholder, you can also increase your life cover based on your changing life stages and protection needs, so that you and your loved ones may enjoy a lifetime of financial safety and well-being – protected against life’s uncertainties.

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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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