A term insurance plan is a perfect helper in the difficult time for every family; this kind of plan provides some additional risks besides other coverages.
About Term Insurance Plan:
Term Insurance is basically a life insurance product which is offered by an insurance company to provide financial coverage to the policy holder for a specific time period. If the insure person dies during the policy term, and then the death benefit will be paid by the company to the recipient. Term insurance plans are very much desired in the life insurance market and the great benefit is that these plans offer higher sum assured amounts at a very low premium rates. A sum money or death benefit is paid to the heir or nominee in case the policyholder dies during the period for which the policyholder is insured. The policyholder can also get various options to get improved protection; there are some term plans available in the market those give protection to the policyholder as cash payouts on diagnosis of critical illness.
In the previous article we read about the benefits and add on covers under a Term Insurance plan; it covers many kind of illness, give benefits to the family etc. but besides all this, Term insurance also provide the most affordable way to secure a substantial life cover. So term life insurance policies are not only limited to cover the risk of death, some plans offer certain in-built features or can give the ability of some add-ons to expand insurance coverage. There are a few of the in-built riders and having these in-built riders don’t ask for extras costs as they availed separately need payment of extra premium. Now if a policyholder has a term life insurance plan with critical illness cover, then tax deduction can be claimed on premiums paid under Section 80D of the Income Tax Act, 1961. The following are the different payouts options an individual can select from under term insurance plan:
A term insurance plan is necessary for everyone either the person has dependent family members or has pending debts to clear. It has high sum assured levels and also low premium rates that makes it an edge over other insurance plans in the market. The payout of this policy helps to keep secure the beneficiary of the life assured continues to lead the previous lifestyle even after the policyholder is no more. But before buying a term insurance cover, it is mandatory to take care of some elements to buy the best plan with best benefits.
Facts to consider before buying a Term Insurance plan:
There are a huge number of term insurance policies found in the market so it become little difficult to find the best-suited policy for a person. Here are some important points to know before buying a term insurance plan:
Lump-sum payout: If the policyholder chooses this option the nominee will get the entire sum assured when the life assured passes away. It will provide immediate cash to the policyholder’s family which can be used in many ways.
Monthly payout: In this option the insurance company will pay a percentage of the sum assured on every month for a fixed number of years of the dependants.
Lump sum & Monthly payout: Here a percentage of sum assured is paid out to the nominee after the policyholder passes away in monthly installment way.