Covers in Term Life Insurance


For the most of us, the moment we want to take a ride/drive on our bikes or cars, wearing a helmet or seatbelt comes almost naturally. It doesn’t require rocket science to understand that these are there to protect you, should something unexpected take place. This does not mean that a person anticipates something bad should happen, but a precaution for the worst-case scenario.

When we start to think of it, life is the most important asset that we have. It is only natural that we take proper precautions for it as well. While being careful and using the right tools, such as helmets and seatbelts, are some of the ways to ensure, there is an even smarter way. Buy a term life insurance.

A term life insurance plan online is the easiest one to understand and is quite affordable at that too. A term plan offers a policyholder life cover in return of annual premiums. Unlike other insurance policies, it doesn’t have a savings or investment components. This lets the plan focus on offering the best life cover possible.

Thus, with a term life insurance, you will end up getting incredibly high sum assured by paying relatively lower premiums. In fact, for a cover of approximately 20 times of your annual income, you will end up paying a premium that costs just 2-3% of your annual income. At the same time, you will be able to buy a policy for a longer duration as well.

According to the policy, should the policyholder lose his/her life during the term of the policy, the insurer will pay the sum assured to the nominees. However, if the policyholder outlives the policy, there are no financial benefits to have had.

Beneficial Covers of Term Life Insurance

As already mentioned, a term life insurance comes across as a no-nonsense plan. A policy holder pays a certain premium and the plan offers life cover should anything unwanted happen to him/her. For simplicity, the plan offers coverage for the death of a policy holder.

In the unfortunate death of a policy holder, the family members might face a lot of financial problems. More so, if the policy holder is the sole bread earner of the family. In such cases, a term life insurance will not only help them get rid of any existing debts but also let them continue with their lives.

A term life insurance usually covers the death of any form as long as the same takes places within the policy period. However, most of the insurers have a star mark when it comes to suicide cases. Insurers, usually do not make any payouts in the event of suicide.

Off late, there are a few insurers who have tweaked their policy to accommodate suicide clause. As a result, some insurers do honor payouts for suicide cases only if the purchase of the policy has exceeded one year.

If you are not happy or want more out of your term life insurance, you can look at the riders on offer. Riders are additional capabilities of your plan which you can include to your core plan by paying some additional premium. Some of the most famous riders include.

  • Critical Illness Cover

In the unfortunate event of a policyholder being diagnosed with a critical illness, the insurer will pay a lump sum amount. The amount is usually a certain percentage of the sum assured and can be utilized for treatment purposes.

  • Waiver of Premium

Should you pick up this add-on, the policy will pay for its premium itself in the event of unavoidable circumstances. This comes in handy if there is any disability or loss of work.

  • Accidental Death Cover

A standard term life insurance covers any accidental cases. However, with this rider you can increase the payout up to two times.

Hospital Covers of Term Life Insurance

As far as riders go, there is another rider that you can opt for your term life insurance. The hospital cash benefit rider can be very helpful during an emergency medical treatment. The rider offers for daily cash allowance for the duration the policyholder is admitted to the hospital. There usually isn’t any proof needed for the daily cash allowance, as there is a ceiling to the same. The cover also offers post-hospitalisation benefits to the policyholder.

There are no second thoughts that there are plenty of riders to choose from a term life insurance. However, one must assess their options on and then pick up something that best suits their needs.

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