5 things to know about term insurance

Then take up this opportunity to know about Term Insurance. Term Insurance is one of the best and affordable insurance for all low and high-income people. It also provides a tax-  free lump sum of money for a financial safety net.

1. What is TERM Insurance?

Term insurance is a life insurance policy that pays out in case of the death of the insured person, during the term of the insurance policy. This type of insurance is cost-effective with highly affordable premiums. These premiums can be paid as Single Premium or Regular premiums, as per the policy you have selected.

In term insurance, a fixed premium has to be paid at regular intervals. In return, the insurance company provides a specific amount as insurance cover. This amount is paid to the family in case the person whose life is insured, passes away. Do you think this is a benefit for your family?

2. Why Term Insurance specifically?

Because

• It provides financial security for your family - Think! What if you are the only breadwinner of your family? Do you want your family to live a sufficient life?
• High Life Insurance amount at affordable premiums - Why to be in oscillation if it is with low premium?
• It takes care of your loans and debts (if any).
• Lifestyle risks - Everyday life is a risky one, as you know! It gives you supplementary income in case of loss of income due to illness or accidental disability.
• Support in case of Disability - Don’t worry insurance company will pay your further premium.

So, now you may know the importance of Term Insurance.

3. But, I’m a Smoker!

Absolutely, Yes!  Term insurance includes even for smokers or users of any tobacco products, such as chewing tobacco. Some smokers who have quit smoking are also eligible for Term Insurance Policy with favorable premiums. However,  the period varies among insurers to insurers.

But the only disadvantage is that, If you Smoke, it’s going to affect your RATES!

4. Riders - Additional Benefits

Riders are the additional or extra benefits to your insurance policy. A term insurance rider is an attachment or amendment to an insurance policy supplements the coverage in the policy. For example, a waiver of premium will allow you to continue your term life coverage for a limited time if you are unable to pay the premium. Following are the riders to your Term Insurance Policies,

• Critical Illness.
• Waiver of premium.
• Accidental death and dismemberment.
• Accelerated sum assured.
• Partial and permanent disability.

The riders sure seem like a necessity if we consider. It's true that we cannot prevent such incidents from happening but we can very well plan for them. Term insurance riders are part of such planning; their presence in your life would help both you and your family.

5. Will you take up a Right Decision?

 In case of any unfortunate mishappening to you, then what will be the financial loss for the family? Do you have adequate term insurance so that your family can maintain the lifestyle and meet the financial goals? Take a right decision to cover yourself adequately with term insurance.

Final Note:

Term insurance is surely a way to go. Many of our clients, who are like you found it was the best decision.

What about you now?

Are you equipped well with all information to make the right decision?

Then Go ahead!

(The author is Ramalingam.K an MBA (Finance) and Certified Financial Planner. He is the Director & Chief Financial Planner of Holistic Investment Planners (www.holisticinvestment.in) a firm that offers Financial Planning and Wealth Management. He can be reached at ramalingam@holisticinvestment.in)