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Planning to buy a term plan?
Avoid the mistakes I made!

Planning to buy a term plan? Avoid the mistakes I made!

A cat has 9 lives, they say. Whether it is true or not, you'll never know. But, what you do know is that you only have one life to make the most of. I do realise that now, but my recklessness cost me some mistakes that I deeply regret. I am 38, got married five years ago, and am blessed with a 3-year-old son and a 2-year-old daughter. But when I decided to buy a term plan at 31, there were a whole of things I failed to take into account. What if something were to happen to me today? Given my pending home and car loan instalments, was my term insurance cover enough to support my family's financial needs? The answer was 'No'.

As I look back and analyse my financial decisions, I realise there are so many things I wish I could go back in time and change.

Here are some of the mistakes I made while buying a term plan:

Opting for a short tenure

Although it is entirely up to you, I strongly suggest you opt for a decent policy term. Consider my case; I was 31 when I bought term insurance for a tenure of 10 years. But when I turn 41, I will literally have no cover at a time when I need it more than I do now, simply because financial risk and liability will both be higher post 40. And if I decide to buy another policy at 41, the premiums I will have to pay will be much higher than what I'm paying right now.

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Buying insufficient cover

Not only did I choose a short term, I also bought a low cover just to save a few extra bucks on premiums. I conveniently ignored taking inflation - and my outstanding loans - into account. Now that I look back, I realise it was a silly move on my part. After mindfully calculating future expenses, I've realised that my family would definitely not have enough if something were to happen to me today. Therefore, I urge you to do the necessary calculation before buying a term plan. Don't worry; here is an insurance calculator that will do the job for you.


I was well-informed about the need and importance of term insurance right from my early 20s, but thanks to my inherent tendency to put off important tasks, I delayed buying one. I kept postponing it to the next month, when I thought I would be in better control of my finances. But each month I had a new excuse! This went on until about seven years ago, when I finally decided to buy a term plan. But it came at a price. My premiums are higher than they would have been had I purchased the plan early. Also, now that I have more responsibilities and expenses, it's slightly more difficult to spare that amount regularly. Long story short - the right time to buy term insurance is 'right now'.

Ignoring riders

Another major oversight that I regret today is ignoring riders that I could have bought along with my plan. At that time, I thought I wouldn't need an optional accidental death benefit or accidental and permanent disability rider. But, now that I've done my research, this seems a huge mistake. If I meet with an accident that leads to my disability, how will I ensure that my family's financial needs are met? Given that I'm the sole breadwinner, it was even more important for me to take relevant riders into account when buying a term plan.

Now that you know the mistakes I made when buying a term plan, I hope you learn from them and be wiser when purchasing one for yourself. If you're looking for a hassle-free term plan that can be customised according to your needs, consider iSelect. It is a pure protection term plan that offers life insurance and terminal illness cover along with optional cover against accidental death/disability. You get to choose the premium payment mode as well as the premium payout option. Learn more about the plan here.

Even after accounting for the mistakes I made, buying a term plan was one of the wisest decisions of my life and it's something I would urge everyone to go for if they wish to secure the financial future of their loved ones. And who doesn't?

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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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