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Gift your loved ones Financial Independence with Term Insurance

Muktha Tavane|5 min read|28 September, 2021

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Gifting your son that PlayStation he’s always wanted or your mother a beautiful piece of jewellery that she’s liked, brings immense joy. A gift, no matter how small, is cherished by loved ones merely by the gesture. Besides the special gifts we present to our family during special occasions, it is important to give your dear ones a financially independent future.

The first, most crucial step towards giving your family a financially independent future is securing their lives with Term Insurance. A Term Insurance plan offers pure protection and offers coverage for a policy period ranging from 5 years to 80 years.

A Term Insurance cover is inexpensive and, hence, one of the most affordable Life Insurance products available in the market. The idea behind buying Term Insurance is to provide financial protection to your loved ones in the event of your untimely demise.

Why should you buy Term Insurance?

While you may choose to allocate your money in various investment options, nothing beats Term Insurance when it comes to securing the future of your loved ones. Here’s why:

  1. Promises financial security to your family: Think of a financial solution that promises a lump sum to your family members in the event of your death. Term plans promise a substantially large sum up to 15–20 times your annual income at nominal premiums. The lump sum that your family receives on your death enables them to manage everyday expenses without making any compromises.
  2. Available at affordable prices: One of the most distinctive benefits of Term Insurance is its affordability. Compared to other Life Insurance products that have a savings and bonus component added to them, pure Term Insurance promises a substantial lump sum coverage at affordable premiums.
  3. Offers flexible coverage: Term plans provide the flexibility to choose the duration of coverage between 5 years — 80 years. Some insurance companies also offer longer durations to the extent of allowing you to remain covered until you turn 99 or 100 years of age.
  4. Easy to manage: Term Insurance is the simplest insurance plan that includes three essential components: coverage amount, policy period, and premiums. There are no market components such as savings, equity or debt involved, making Term plans the easiest to manage.
  5. Replaces lost income: Some Term Insurance plans offer the option to provide the sum assured on a monthly basis. This enables the family to receive financial assistance every month, replicating the monthly income stream the family received through the life assured. The added benefit of choosing this payout method is that insurers tend to pay more than the sum assured if the deferred payout option is exercised.
  6. Provides tax benefits: Buying Term Insurance helps you avail the following tax benefits in India:
  • Under Section 80C of the Income Tax Act, 1961, Term Insurance premiums are eligible for tax deduction every year.
  • The Term plan payout one receives from the death of the policyholder is completely exempt from tax under Section 10(10D) of the Income Tax Act 1961.

Note: As per the prevailing tax laws. Tax laws are subject to change from time to time.

Why buy Term Life Insurance early?

The Covid-19 pandemic has brought to light the importance of financial independence. Thinking of the plight of families who lost their breadwinners to the deadly disease is disheartening. The pandemic still is a threat that cannot be ignored, and even after the pandemic ends, we need to remember the lesson we learnt — life is uncertain.

A Term Life Insurance policy ensures the financial security of your loved ones in case of your untimely death offering them the necessary financial support to keep going.

Besides financial independence, buying Term Insurance lets you avail the benefit of low premiums. A person buying a Term policy cover in his/her late 30s or mid-40s will have to pay a lesser premium compared to customers in their late 40s or 50s for the same cover. This is because the probability of death increases with age, which is why younger individuals are charged a lesser premium than older individuals.

Also, once bought early, the Term Insurance premium remains fixed over the entire policy period.

Why are Medical Tests Important for Term Insurance?

Insurance companies are always exposed to risk when you buy a Term plan from them. Therefore, many Term insurers mandate certain medical tests to assess the health conditions of a prospective life assured before deciding on the best terms suited to him/her.

Tests are recommended depending on the individual’s age and the policy coverage he/she has applied for. Whether the insurance company will agree to your Term policy application depends on its risk perception of you. The results of the medical tests will gauge your overall health condition and risk profile.

Insurers typically bear the cost of medical tests they recommend, reducing the possible financial burden it may have on you.

How Telemedical Tests save time and effort

Technological advancement has made buying Term Insurance much easier. As opposed to the cumbersome paper and pen process, most Term Insurance policies can now be bought online. Some insurance companies extend the benefit by giving their customers the prerogative to buy Term Insurance policies, without the mandatory physical tests, while buying them online.

This hassle-free process involves a doctor calling up the customers to inquire about their medical history and condition. The telemedical process has now been adopted by many insurance companies and is deemed safe by prospective policyholders.

What matters more while buying Term Insurance — Brand or Price?

Price is certainly a key factor that would help in making a Term Insurance purchase decision. You should ideally ensure that your family has sufficient financial support, at an affordable premium that you pay towards the policy. However, it is important to focus on the plan benefits offered to evaluate if it makes sense to your family’s lifestyle.

Secondly, you should run a complete check on the brand you plan to buy the policy from. You should check the Claim Settlement Ratio published by the Insurance Regulator, IRDAI. The claim settlement ratio of a life insurance company is basically the ratio of the total number of claims settled against the total number of claims filed. This number tells you how the insurer has treated claims in the past allowing you to understand how it would honour claims filed under your policy.

Additionally, what’s most important while buying a Term Insurance plan is to go through the policy document word by word including the payout details, exclusions, and other conditions.

Why buy Term Insurance with us?

As we rally through our busy, fast-paced lives, we tend to focus on paying bills and EMIs while insurance purchase takes a back seat, often because of the tardy process of finding the right plan and making the purchase. The solution to this lies in buying your Term Insurance plan through PhonePe Insurance Broking Services.

On the app, you can enjoy the following benefits as well:

  • Choose from an array of options: With access to multiple insurance companies, you can choose an insurance plan with a high sum assured best suited to your needs.
  • Pay affordable premiums: We enable you to buy a higher cover amount at lower premiums. A Term Insurance plan on the platform starts at just Rs.6/day*.
  • Enjoy a seamless digital experience: We offer you an exceptional online experience with a large variety of plans and brands you can choose from. You can complete the entire insurance purchase process in a matter of minutes on the go!

How do you get Term Insurance from us?

Step 1: Find the Insurance tab on the app and click on Term Life

Step 2: Provide the information requested to curate the best quote option for you

Step 3: Select the quote based on your preference

Step 4: Make the payment

Step 5: Follow steps to complete the application and policy issuance

No matter what your age is, if you support your family financially, do not spare even a moment to think if you need Term Insurance. Buy a Term Insurance plan without regarding it an expense but an essential step to secure your family’s dreams.

*Premium for 18-year-old female, for 25 Lakh sum assured and a term of 7 years

If you are planning to purchase term insurance, check out the links below to know more

Term Life Insurance

1-Year Term Life Insurance

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