An insurance plan to cover your escalating growing needs

Term plans are the best insurance plans of modern day times that are capable of giving high coverage at optimal costs. But since most of the companies don’t get many profits from these plans very few companies offer these low cost insurance plans. Besides, agents are also not keen on selling these plans to customers. Therefore, customers have to do their own set of research, check for the features and discounts, compare them amongst the insurance providers and then approach an agent to buy the suitable one or they can buy online themselves.

With the advent of internet, things have become easy, simple and sorted. Online term plans costs 30-40% cheaper compared to offline policies. The premiums are also very low due to the fact that there is no intermediary and online buyers are perceived as low-risk customers. Online buyers are educated, earn fair amount of money and also projected to have their health covers in place. Therefore, term policies are cheaper as compared to offline purchases. In these policies, the cover increases with time to hedge against inflation.

Term plans are best suitable for those who are careless about the payments. Every year a set amount of premium has to be paid for which the coverage is offered. If they miss a premium the policy could be lapsed. Therefore, when the premium payment is staggered over 15-20 years you’re bound to fulfil your responsibilities for the coverage needs. For people who think that buying a term plan is a waste of money, insurers have designed policies that return the entire premium at the end of the term. But this feature increases the premium of the policy considerably.

While purchasing term plans you need to keep following points in mind:

Liabilities

Term plans are purchased to cover up your liabilities like mortgages and loans over the period of time. Therefore, the tenure of your policy should incorporate this time-frame. So, if you have taken a car loan which might take 5 years to clear off then the term must last atleast 5 years.

Dependents Quarantine needs

If your dependents have few years to earn money then the quarantine phase should be incorporated under your plan. Events like children marriage or educational career should be covered under your term plan so that your family can cope with the financial uncertainties.

Length of Support

The aid to your family is directly proportional to the sum assured. Therefore, it is up to you, to decide if the sum assured should last the family for many years or just support the family until they get back on their feet. But it is advisable to never push your limits for covering up extra else you will not be able to manage funds properly for premium allocation. Stay within your income sources.

Affordability

Check what your income sources are? And then arrive at the conclusion for tenure. Although you might think long term cover is the best one for you but also see if you will be able to pay the premium till that phase without lapsing any of the premiums.  If the policy is too long financial strain, reduce your term plan for few years.

Term plan are one of the best insurance plans of modern day times because it provides a life cover pertaining to your needs. You need to pay the premiums only till you need the cover, making it the cheapest and the most flexible plans under the long list of insurance policies.