What is Term Insurance and its Benefits?

Remember when you rode a bike down the roads with a helmet? At first, the helmet might have felt inconsequential, but the minute you had a fall, it proved its value by preventing you from getting a severe injury. Term insurance works on the same lines. It is a type of insurance that protects yourself and your loved ones, especially in your absence. A term insurance plan provides financial support and various other benefits. Getting one early in life ensures you get the maximum of term insurance benefits at an affordable cost.

Read on to find what exactly are the term insurance benefits that make it a must-have in your financial portfolio:

1. A term insurance policy provides life insurance protection.
The core purpose of a term insurance plan is to provide financial support to the family of the sole or co-income earner in their absence. By giving life insurance coverage to your family members in the eventuality of your unfortunate demise, a term insurance plan aims to become a primary or added source of income to get them through. It does this by paying a guaranteed death benefit payout or sum assured as soon as the eventuality of death occurs.

Through this, your loved ones have enough to sustain themselves and achieve their goals. In some of the best term insurance plans, you also receive a return on the premiums you have paid towards the policy.

2. A term insurance policy protects against unforeseen eventualities.
Not only does a term insurance plan provide a guaranteed death benefit in the eventuality of death, but it also provides coverage against other unpredictable scenarios. The eventualities include but are not limited to:

• Death arising due to an accident
• Permanent physical injury due to an accident
• The development and diagnosis of a critical/ terminal/life-threatening illness

However, these extra term insurance benefits are available only when you pay some extra money (or premiums) towards the term insurance plan.

3. A term insurance policy is affordable yet comprehensive.
A term insurance plan provides comprehensive and all-around financial coverage at affordable prices. In fact, term insurance is one of the most budget-friendly forms of insurance. You can get a cover of more than ₹1 crore at an approximate monthly premium price of ₹900 to ₹1,000. The affordability yet holistic nature of term insurance is what makes it so popular among insurance buyers. Moreover, with the best term insurance plan, you get the added advantage of choosing how and when to pay the premiums. You can pay in monthly, quarterly, or annual instalments, and decide a cover amount that fits your needs and budget. Another benefit is the extra discounts you receive while buying a term insurance plan online.

4. A term insurance policy is free from any market risk whatsoever.
Term insurance plans are pure, non-linked, and non-participating insurance plans. These features mean that term insurance is a safe investment avenue. Free from the fluctuations of market-linked investments, it is ideal for those who don’t want to take any risk of loss and chances on their family’s security. It provides an immediate death benefit on the occurrence of any policy-listed eventuality that causes the death of the policyholder. It is not a wealth-creating tool, but the benefit amount your family receives is enough to negate the effects of inflation and will be sufficient for their sustenance. Another great thing about term insurance is that it gives tax benefits under the respective provisions of the Income Tax Act, 1961.

To sum it up:

Term insurance is a fuss-free insurance product. The scope of financial protection it can provide to your family is inflation-adjusted and affordable, which makes it a must-add in your insurance portfolio.

To know more about life insurance, term plan & long term savings visit PNB MetLife website.