Skip to main content

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.

Labels

Labels:

Comments

Post a Comment

Popular posts from this blog

Story - ICICI Prudential's success story

ICICI Prudential's success story It is a real life story. A story of an insurer that has managed to hold on to its lead in the marketplace for seven years. ICICI Prudential, a joint venture between ICICI Bank   and Prudential UK, has been around ever since the private sector was allowed to sell life insurance policies.   Since then the tribe of life insurers has grown from 12 to 16, but ICICI still leads the private sector pack. With a portfolio of over 6.5 million policies, India's biggest private sector life insurer has not merely held on to its share but grown it; at the end of January 2008, the firm commanded 29 per cent of the share owned by private sector players. Quite some way below was Bajaj Allianz with 21 per cent, while State Bank of India   came in third with 10 per cent. How did ICICI achieve that? Says Ashvin Parekh, national leader, financial services, Ernst & Young, "Their strategy has been to grow the portfolio large enough so ...
Post a Comment
Read more

Glossary-R

Rate: The pricing factor upon which the insurance buyer's premium is based. Rated Policy: Sometimes called an "extra-risk" policy, an insurance policy issued at a higher-than-standard premium rate to cover the extra risk where, for example, an insured has impaired health or a hazardous occupation. Ratemaking: The statistical process by which insurers determine risks and pricing for the basic classes of insurance. Rating Territory: A geographical grouping in which like hazards tend to equalize and permit the establishment of an equitable rate for the territory. Reasonable and Customary Charge: A charge for health care, which is consistent with the going rate or charge in a certain geographical area for identical or similar services. Rebating: Giving any valuable consideration, usually all or part of the commission, to the prospect or insured as an inducement to buy or renew. Rebating is prohibited by law. Recurring Claim Provision: A provision in some health in...
Post a Comment
Read more

Annual Premium Rates-Term Plan

Term life insurance is the original form of life insurance and is considered pure insurance protection because it builds no cash value. Term life insurance provides coverage for a limited period, the relevant term. After that period, the insured can drop the policy or pay annually increasing premiums to continue the coverage. If the insured dies during the term, the death benefit will be paid to the beneficiary. Term insurance is often the most inexpensive way to purchase a substantial death benefit on a coverage amount per premium dollar basis. This is purely risk protection. Below the comparative chart of premium (without return of premium Option) for a 25-Year-old person for a sum assured of 1000000 for a term of 20 years. Insurer (Insurance Provider) Premium Comments (Riders- Accidental death & Disability, Weaver of Premium, Critical Illness) Bharti AXA Life Insurance 2620 No Riders SBI Life Insurance...
1 comment
Read more