Term insurance plans have become the best lifeline for financial support in the pandemic era. People consider it important for securing their family’s financial future. It is the best way to organize your income for the benefit of the whole family. However, doing it the right way will ensure maximum protection. Purchasing the term plan early and including the right features are essential. Here are three crucial aspects that you need to consider for your term insurance plan.
- Add-on rider benefits: A basic term insurance plan can suffice for providing a large life cover to protect your family in your absence. However, the recent pandemic has proved that medical emergencies can require huge expenses during the policy term. An add-on rider benefit such as the critical illness rider can make a part of the sum insured payable for handling your expenses related to hospitalization and other treatment charges. There is the option to waiver future premium payments if you get affected due to a total and permanent disability in an accident. Term insurance plans in India from different insurers have various rider options with distinct features. Based on your family medical history, you can choose the rider options when you buy the term plan online.
- Inflation rate: When you decide on the sum assured for your term plan, it is important to calculate it considering the inflation rate. The sum assured is basically for your family’s expenses when you are not around in the future. It can be several years hence or in the immediate future. However, it should account for the inflation rate to accommodate the prevailing rate of expenditure then. Also, during your employment phase, you would have developed a standard of living for yourself and your family. Therefore, as an important responsibility, you should try to ensure it for them in your absence as well. You can use the TATA AIA term plan calculator to derive an approximate sum assured based on the premium amount and the policy term.
- Best payout options: Term plans do provide varied payout options. You can plan the payout for your family based on the long-term financial commitments and the daily spending pattern. For example, suppose you feel your children or the nominee may not be able to handle a lump sum effectively. In that case, you can decide on the payout as a combination of lump sum and the rest as regular income for a certain income period. The lump sum can be used for paying off debts or planning for your child’s higher education or marriage. And your family can use the remaining amount for their daily expenses. Compare term insurance plans from different insurers based on their claim settlement ratio and user reviews and choose the right product that will suit your needs.
An online term insurance plan is the simplest and the basic way to secure your family’s financial needs. However, it can be customized to ensure maximum protection. The three crucial aspects, inflation rate, add-on rider benefits and payout options, can help you use the term plan benefits wisely and productively. So, choose the right term plan, customize it appropriately and stay insured for the best benefits!