o you have a term insurance policy? Any talk about insurance and you will be asked this question.
So, do you?
If you have a family or dependents, term insurance is a must. No other policy will offer you as much value for money as this one.
What is the big deal?
In its simplest form, term insurance is the purest form of life insurance. Should the insured person pass away, the family is protected by a certain amount.
Let's say you bought a term insurance policy for Rs 25 lakh (Rs 2.5 million). The term of the policy is for 20 years.
If you pass away during this period, your family will be richer by Rs 25 lakh.
But, if you outlive your policy, all your premiums (money that you pay to the insurance company to maintain your policy) would have gone down the drain.
How much is your life worth?
So should you?
Yes. Mainly because it provides a safety net for your family.
Second, it is the cheapest form of insurance available.
Individuals find it hard to buy term insurance because it deals with the possibility of their own death. Morbid, isn't it? Nevertheless, it is a reality.
Look at it another way. You would
buy car insurance without batting an eyelid. The rationale for both is the same.
If your car meets with an accident or you have to pay damages to anyone, the insurance company compensates you. But if you are a safe driver, the premium goes down the drain.
Surely your life is worth more! At least check out what is on offer.
Insurance lessons you must learn!
As the name suggests, you pay the premium once and for all. Convenient.
You can avail the cover till the specified term ends. A great way to spend your windfall gain or bonus.
ICICIPrulife, Omkotak Life, HDFC Standard Life Insurance and Birla Sunlife Life Insurance are some players offering this policy.
Let's say you are 30 and are looking at a 15-year term policy. You want your young wife and child to get Rs 25 lakh should anything happen to you.
You will have to pay a one-time premium of around Rs 51,420 to Birla Sunlife and Rs 64,575 to HDFC Standard.
These are plain vanilla insurance policies. If you don't want to make a huge one-time payment, go for this option.
You will have to pay the premium every year till the end of the insurance term.
Let's take the same example as above but for a 20-year policy.