One of the simplest types of life insurance is term insurance, which guarantees that the insurance company will pay out money to its beneficiaries against the premiums paid by the insured during his lifetime when the insured person dies. As new investors look for easy and safe investment options, it is hardly surprising that term plans are the most popular among this group.
The tenure of such a policy can range from 15 to 40 years or even more and the person buying this plan can choose the tenure as per his requirement. Amit Jaiswal, Chief BALIC Direct Officer, Bajaj Allianz Life, said that the premium term plan depends on the age of the individual and the total sum assured at the time of commencement. Term plans come with various features and flexible options for customers to choose from. Be it the addition of terms as per the policyholder's needs or the option to reduce the amount of premium payable, there are multiple reasons why these plans are preferred by people involved in various professions.
Some term plans come with a death clause but also give the policyholder the freedom to add additional options like accidental death, permanent disability, critical illness and pension provision after reaching a certain age. Some other types of term plans come with a money back feature where some percentage of the sum assured is returned to the policyholder after every five or ten years. These periodic payments are deductible from income tax under Section 10 of the Income Tax Act. This option is a boon as it allows the policyholder to use this amount for major expenses like child's education or marriage or funds for starting a business.
Some term plans offer an option to reduce the amount of premium payable. Some professionals have assets but also have dues and debts to pay. Paying low premium for these people reduces their financial burden as they do not have to use the cash on hand for investment but also they can secure their financial future through a life insurance policy.
Excellent means to meet financial needs The reality is that term plans now have many flexible options as per the specific needs of the customer. It is no exaggeration to say that buying a term plan without further delay is a wise investment to secure the future of one and his loved ones. Delaying this purchase not only leaves your loved ones unprotected but also puts you in a position to spend more later on as the premium increases with age.
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