Term Plan and Its Benefits

The insurance sector in India is growing in leaps and bounds with each passing decade. The growth in the sector has given rise to different insurance products. However, of all the products on offer in the insurance bouquet, term life insurance is considered to be the best insurance option.

We list down some of the benefits of investing in a term insurance plan by Max Life Insurance. Let us understand what a term plan is all about.

What is a Term Plan?

Term plans are the simplest form of life insurance plans with no frill attached to them. They do not offer any high life covers for a low premium. Also, if you outlive the tenure for which you have purchased the term plan, you do not receive anything back at the end of the tenure.

However, term plans are important because of their basic nature. Many a times agents do not suggest term plans with the motive to make you fall for higher premium plans in order to yield higher commissions. However, the point to be considered here is that term plans are able to give us high covers exactly because of low premiums.

Benefits of Term

Let us now have a look at the benefits associated with term plan. Let us compare term plans with one other product, which also does not give anything back at the end of the term - Vehicle Insurance. Though the basic features and coverage are different, a comparison can provide more perspective.

For an Rs 35,000 two-wheeler, you will have to approximately pay Rs 900 a year as a premium. For which, you will receive a third party accident cover of Rs 1, 00,000.

Similarly, for a four-wheeler vehicle worth Rs 10 lakh, 1500cc, the premium will be Rs 28,000 per year. Also note, insurance for a car with capacity less than 1500CC will set you back by about Rs. 25,000 per year.

Now, compare the above mentioned premiums with that of the premium for a life cover of Rs. 10 lakh for a 35 year old male. The premium here will come to only about Rs. 4,300 per year.