Life doesn’t come with certainty. That’s why you need to be prepared especially when you are the only earning individual in your family. By preparation, we mean financial preparedness. Financial preparedness is necessary if you want to reduce the financial repercussions your absence might bring on your family. Buying a term insurance plan is how you do it.
The best term insurance plan provides life coverage to your family in the worst-case scenario. This plan offers death benefit to the beneficiary, i.e., in the event of them passing away.
Term plan insurance has a lot to offer with its diversified features and benefits. Here are 5 things to know when you are buying the best term insurance plan:
1. Claim Settlement Ratio:
Claim Settlement Ratio can be defined as the percentage of claims paid against the percentage of claims filed. The claim settlement ratios for all life insurers are made public annually by the Insurance Regulatory and Development Authority (IRDAI).
If the insurer rejects the beneficiary’s claim under the policy, investing in life insurance would be useless. Therefore, you must consider the claim payment ratio while choosing an insurer.
2. Solvency Ratio:
A solvency ratio is a key metric that enables an individual to check if the insurance company would be able to support them financially during their hour of need. The solvency ratio is used to measure a company’s cash flow. It helps in determining a company’s cash flow in the long run against its liabilities.
The debt-to-assets ratio, the interest coverage ratio, the equity ratio, and the debt-to-equity (D/E) ratio are the four primary measures of solvency.
3. Critical and Terminal Illness Coverage:
The best-term insurance plan offers protection against life-threatening diseases and illnesses. In the need of the hour, the beneficiary of the policy can get the medical bills covered by the insurance company.
Having a family member diagnosed with a critical and/or terminal illness is heartbreaking. On top of that, there are medical bills that cause anxiety not just to the family members but also to the person diagnosed. Choosing the best term insurance plan can help you save stress while at the same time you can easily settle the medical expenses.
4. Additional Coverage:
The primary goal while choosing the best term insurance plan is to secure one’s family’s future. The best-term insurance plan will provide you with the necessary life coverage. But there are some additional coverages available on a term insurance plan that you must know about –
Waiver of Premium: The life insurance coverage will continue without fail requiring no additional premium payments made by the policyholder.
Accidental Death: The best term insurance also provides an accidental death benefit, the nominee will receive the sum assured if the policyholder passes away given unfortunate circumstances while the insurance plan is still in effect.
Income Benefit: Tragedies are a part of life and sometimes you might catch yourself thinking about how your family will manage things after you. If this is something that concerns you, you can stay relaxed because the best term insurance plan provides monthly income to your family during your absence.
5. Cost of Premiums:
Cost of premium is an important factor for most investors when they are buying term insurance. You should always choose a term insurance plans that comes with premiums you can afford to pat. The best Term Insurance Plans can be easily chosen through a term plan calculator. A term plan calculator as a tool helps in comparing the best-suited term insurance plans for an individual. You can weigh the premium rates for high coverage plans offered by different companies and get a good deal for yourself.
Let’s understand a term life insurance calculator in detail.
What is a Term Life Insurance Calculator?
It is an online tool used to find a suitable term plan insurance for an individual according to their requirements. It is an easy and free-to-use tool with a user-friendly interface.
Term Life Insurance Calculator is also used as a comparison tool to search for the best-suited term insurance plan for an individual. To safeguard your family and your future from unforeseen emergencies, a Term Life Insurance Calculator is the way to go.
How to Use a Term Life Insurance Calculator?
Term Life Insurance Calculator can be used to calculate premiums in just a few simple steps-
Step 1: Search for a Term Life Insurance Calculator online.
Step 2: Enter your details – your age, lifestyle habits and the preferred amount of coverage – and submit.
Step 3: Enter some additional required details –
- Your full name
- Date of birth
- Phone number
- Your salary in lakhs
Step 3: Click on submit/view premium and the premium will be displayed on your screen.
Additionally, you will have to choose –
- Cover till what age (Max. 85 yrs)
- Pay till age/maturity
- Mode of premium payment – monthly/annually
Step 4: Selection of add-on riders(optional)
- Critical illness
- Return of premium
- Accident cover
- Waiver of future premium
Step 5: The last step offers you various and the best term insurance plan for you to choose from and secure your family!
Choose a term insurance plan today, it’s just a click away!