How many Indians are covered by insurance? And, what are the benefits of term insurance that you should consider when deciding on what kind of life insurance cover you should get? Well, we shall get the facts straight and clear the air around this here. Read on to learn more about some important term insurance benefits that you cannot afford to ignore.
What is Term Insurance?
Term Insurance is a type of life insurance that is must cheaper to avail than permanent life insurance. This type of insurance has no cash value, except for the guaranteed death benefit from the policy.
You can avail it from almost all major insurance providers, with various lengths of terms (10 years, 20 years, 30 years, etc.). What is unique with Term Insurance is that you have the option to convert it into a permanent life insurance policy, irrespective of your state of health.
Are all Indians Insured?
No, only 25% of the Indian population is covered by insurance. While 65% of urban Indians have availed life insurance coverage; only ONE out of FIVE life insurance holders has taken advantage of term insurance benefits. Despite the 200-year legacy of India’s insurance industry, the rest of the 988 million Indians or a shocking 75% have still not availed any form of insurance benefit from either the public and private sector. This lack of awareness in the masses and limited reach of insurers are the main reasons why millions of Indians do not have access to the benefits of insurance.
Term Insurance Benefits
Here are some important term insurance benefits you must keep in mind when making your choice of life insurance:
- You can choose the sum assured under the term insurance policy, so you get enough coverage. You should take note that inadequate coverage defeats the purpose of being insured. At the same time, it is important that you review your insurance coverage to find areas where you can cut down, so you are not over-insured.
- Premiums paid towards term insurance plans are eligible for tax benefits under Section 80C of the Income Tax Act. The death benefit you receive under the plan is eligible for tax deductions under Section 10 (10D) as well.
- Insurers offer you a choice when it comes to the type of plan you wish to opt for. You can choose between single or joint-life plans, depending on your needs. You can thus choose to extend coverage to dependent spouses or choose a plan exclusively for the breadwinner of your family.
- Term insurance plans offer you coverage for a fixed term. You may take the term insurance for a fixed duration wherein your family is financially protected. Following this, you and your dependent can retire comfortably.
- Term insurance policies offer flexible premium payment options, allowing you to choose a payment plan based on your convenience. You may choose to pay your premiums either monthly, quarterly, half-yearly, or annually.
- While a regular term insurance plan does not have any survival benefits, various insurers offer plans such as Term Return of Premium Plans (TROPs), which offer survival benefits in the form of premium refunds at maturity.
- You can find offline term insurance policies that allow you to pay the lowest amount as broker commission. No broker fees shall be charged if you choose to avail an online plan.
It is very easy and convenient to apply for Term Insurance Packages. Find the one that suits your needs and take advantage of the term insurance benefits offered by such plans.