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Term Insurance Policy

Term policy - It is the purest form of life insurance at the lowest cost. The policy keeps the insured person in the protection net for a specific term as decided by you (normally 5, 10, 15, 20 25, 30 Years). If the insured person passes away, his nominee would receive the insured amount (Sum Assured, decided for the premium paid when the policy was taken). You can decide the amount (sum assured) which you want your family to receive if some unfortunate incident happens to you. In case you survive the term; you may or may not receive any maturity amount depending on the option chosen by you in the beginning.

It has two options-

  • Cover with return of Premium- If the insured person survived the term then premiums paid throughout the term for the life insurance cover are paid back as a maturity benefit. The maturity may or may not include the bonus (depending upon the plan chosen by the Insured). For example- Rs 9000 for a 10 Lac cover for 10 year Term.
  • Cover without return of Premium- No maturity benefits if the insured survived the term. Premiums once paid will not be refunded. For example- Rs 3000 for a 10 Lac cover for 10 year Term.

It is recommended to opt for a term policy when you are in your young because at that age the premiums calculated are very nominal as compared to the premiums calculated at the age of 40 or 50 years and therefore the life insurance cover can be continued for a long period at that small premium.

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