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Deciding Term Insurance Premium Basis Life Expectancy

Deciding Term Insurance Premium Basis Life Expectancy

Insurance Premiums

A term insurance has long been acknowledged as one of the best investments a person can make. A term insurance is ideal owing to its low cost and the protection it offers to beneficiaries long after the policyholder is no more.

A term insurance plan will allow the policyholder to live in peace with the knowledge that their family members will be well looked after even if they are no longer around. It is thus, one of the first investments made by a person when they first start earning. A term policy such as the iSelect Star Term Plan, available on Canara HSBC Oriental Bank of Commerce, will enable you to customize the plan in such a manner that you will be able to add your spouse in the same policy at a discounted rate, and you will also be able to select from multiple options in terms of premium payment and for receiving benefits.

Age, a primary factor for determining Insurance amount

There are several factors that you need to consider while buying a life insurance plan. The most important factor that decides your premium is, of course, your life expectancy. Age decides the condition of your health, the number of years you will continue to pay premiums and how soon the insurer will be required to make the payout.

As a result, your life expectancy is the first thing ascertained when you approach an insurer for a life insurance policy. The younger you are when you opt to purchase the term policy, the longer you are expected to live. This suggests to the insurer that you pose a lower risk to them in terms of having to settle claims and thus, they are willing to reduce the amount you pay as premiums.

Term Insurance Coverage

As you age, and if you approach an insurer for a fresh term policy, your premiums are likely to be significantly higher. This is because your advanced age makes you more prone to illnesses or diseases that could result in the insurer having to settle your claims sooner rather than later.

Life expectancy is thus the most important factor that decides the cost of your life insurance premium. However, aside from life expectancy, there are several other factors that determine the amount you will be required to pay as premium. With digitalization of the insurance industry, it is now possible to understand how much premium you are expected to pay from the comfort of your own home. You can select customizations such as the coverage you want, pick the covers you wish to add and understand immediately the premiums you will be required to pay.

Other Factors that Influence your Policy Premium

1. Gender: Studies over the years have demonstrated that women tend to live longer than men do. This trend has been picked up on by the insurance industry, and premiums for life insurance policies are often less expensive for women than they are for men.

2. History of Health and Illnesses: An insurer will also enquire about your medical history including the diseases you have suffered from, any pre-existing conditions as well as look into genetic disorders that may have been passed down to you. Someone with a history of serious illnesses will be asked to pay higher premiums as compared to somebody who has suffered relatively less. This is because insurers believe that if somebody has been ill more often in the past, they are more of a risk to insure as compared to somebody who has not had any serious diseases.

3. Unhealthy Habits: When you approach an insurer for a term insurance policy, be prepared to answer questions regarding your lifestyle and habits. The insurer will want to know about your tendency to smoke or drink or indulge in other unhealthy habits. A regular smoker is likely to seem like a greater risk to an insurer, and will therefore be asked to pay higher premiums as opposed to somebody who does not smoke.

Your premiums on your term plan will be dependent largely on your health but also on other factors such as those listed above. Opt for the iSelect Star Term Plan, available on Canara HSBC Oriental Bank of Commerce, and get your policy immediately by paying premiums online. You can select the covers you want such as Accidental Death Benefit, Accidental Total & Permanent Disability Benefit and even Child Support Benefit. The plan can be customized according to your requirements from the comfort of your home.

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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