Term Insurance – An Inevitable Investment

The article is written by Mr. Gaurav Rajput CMD Aviva India, If you want to contribute guest post on this blog, check out the guidelines and join our information sharing program.

Importance of term insurance

What will happen to your family if you are not there? Will your family be able to take care of the financial implications like loans, regular income? Will your children be able to afford higher education in the best of institutions? If you do not have answers to these questions or are not confident about your family’s future financial stability, then you must consider buying a term insurance policy.

Term insurance is the most important and critical investment that every individual must make, as it insures the well being of their loved ones, even in their absence. It protects your family and secures their future in the event of your unfortunate demise during the proposed period covered by your policy. All financial planners recommend buying a term insurance plan as the first product when starting a financial portfolio.

Term insurance policies are extremely simple as they cover only the life of the insured. Basically, what it means is that incase something happens to the policyholder, the family members get the money and if the policyholder survives the policy term, then there is no payout. Term insurance is basically a financial safety net incase something happens to the earning member and hence it comes at a low cost. For example, a 30 year old non -smoker can get a cover for as much as 50 lakhs in a term plan for an annual premium as low as Rs. 5000. Since the premium of term plans depends on mortality risk, it rises with age, so it is advisable to invest in a term insurance plan early in life. The amount of life cover that one opts should be such that it supports the family adequately even when they are not around. As most term insurance plans give cover for maximum 30 years, an individual can also invest in two plans with a gap of 10 years so that he is covered for a longer duration of time. The policyholder can also save some amount, as the premiums are very low and use the savings to make necessary investments in other financial offerings to form a complete portfolio.

Online Term Insurance

Many insurance companies have now launched online term insurance products that are much cheaper and easier to buy. These plans are cost effective mainly because the marketing and distribution costs for the products are low and there is no agent’s commission involved. Aviva’s i-life is the cheapest online term insurance plan available in the market offering a minimum cover of Rs. 25 lakhs with no upper limit and a maximum term of 35 years. i-life is available for investors to buy online at Aviva India’s official website.

Buying an online term insurance is extremely simple. An individual has to go online and calculate the cover he or she needs (many companies provide insurance calculators on their websites) and the premium. All one has to do is fill details like personal information, amount of life cover required, policy term, and medical information, followed by which you get a premium quote, and pay the amount online. After you have paid the premium, you may get a mail or call from the insurance company to submit the important documents required for essential procedures like KYC (Know your Customer). A lot of companies these days allow you to upload documents online. An individual can then go for medical examination if required. Do keep in mind that the cover and the claim settlement depends on the authenticity and accuracy of the information given when buying the specific term insurance plan. It is best to disclose things like any pre-existing medical conditions, habits like consumption of tobacco and alcohol, etc to ensure smooth and quick processing. It will also ensure that your claim is processed hassle-free.

To sum up, term insurance is the most affordable option to provide financial protection to your family and secure their future even when you are not around. So, invest in any term insurance plan today.