What is Term Insurance?

Once you know what is term insurance and choose one to buy, you can add riders to your term insurance plan. Riders will help you extend your policy benefits by paying additional premium, and get comprehensive coverage and riders serve this purpose well.

With Max Life Insurance, you can opt for Max Life Accidental Death and Dismemberment Rider [104B027V05; Non-Linked Non-Participating Individual Pure Risk Premium Health Insurance Rider] & Max Life Waiver of Premium Plus Rider [UIN: 104B029V05; Non-Linked Non-Participating Individual Pure Risk Premium Health Insurance Rider].

As taxpayers, you may be concerned about what is term insurance tax benefits. With term Insurance plans, you can avail tax benefits on premiums paid under Section 80C of the Income Tax Act, 1961. You can avail tax benefits up to Rs.1.5 lakh on the premium paid. Not only this, with the critical illness cover, you can also avail additional tax benefits on premium paid under Section 80D of the Income Tax Act, 1961.

Tax benefit as per prevailing tax laws

You must fully understand the financial needs and requirements of your family to determine what is term life insurance and benefits, best-suited for your family. It provides security and stability to your family, hence the policy you choose must have an adequate life cover, enough to take care of your family’s needs in your absence.

To understand what is term plan cover required, start with analyzing all sources of income, the number of dependents, existing financial liabilities, and the lifestyle expenses of your family. Moreover, you should consider the life goals of your spouse and children to determine the term policy meaning for their future.

This way, you will be able to understand what is term plan meaning and select an adequate financial protection that will help your family live without worries, even in your absence.

Once you have assessed your financial needs and understood what is term plan meaning, the next step is to calculate what is term life insurance premium that you need to pay for your policy. When you search online, you will find there are multiple kinds of term plan meanings available, as there are different types of term plans. These include basic term insurance plans, term insurance with survival benefits (term plans with return of premium), and term insurance with various payout options.

Estimating what is term plan premium depends on several factors such as the chosen life cover, policy tenure, type of plan, age, gender and smoking habits. One way to check how the premium varies with these factors is to use an online term insurance premium calculator.

The ideal coverage amount should be around 15-25 times your annual income for term life insurance, meaning your loved ones have a substantial corpus to take care of them when you are not around.