What is Term Insurance?
Term insurance is basically a type of life insurance that provides coverage for a certain period of time or years. The nominee of the insured person receives the death benefit if the insured dies when the policy is active. Among life insurance plans, term insurance provides the highest life insurance coverage for the lowest premiums during the period of the plan.
How Term Insurance Plan from HDFC Life helps you?
Term Insurance Plan by HDFC Life provides you with the advantage of large life insurance cover for an affordable premium.
Riders covering other risks such as accident are available and can be attached to term plans and provide a much wider protection to your family.
Married Women's Property Act
The Married Women's Property Act, 1874 (“MWPA”) was created to secure the assets owned by a woman against her husband, his creditors, and relatives. Section 6 of the MWPA covers any insurance policy taken out by a man on his own life in favor of his wife and children.
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HDFC Life Click 2 Protect 3D Plus is a term insurance plan which ensures protection against the 3 eventualities of life - Death, Disability and Disease. The 9 plan options will help you pick the most suitable plan option as per your requirement.
- Life cover @ nominal cost
- Life Stage protection feature
- Flexibility while choosing the plan
- Tax Benefits
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3 Steps to the most suitable online term plan for you
One of the awesome things about online term plans is the freedom you get to take charge of your future. At the same time, it also brings upon you additional responsibility of staying informed about product features and your needs. Only when you match your requirements with the term plan that works for you are you able to buy the right plan.
Here are three steps to making the right choice.
Here are three steps to making the right choice.
- Step 1
Find out the life insurance amount you need Your term life insurance should be able to cover your family’s living expenses and future obligations.There are many life insurance calculators available online that you can use for reference. At the same time, it is useful to know how to arrive at this figure.
To begin with, arrive at the life insurance amount you would require to cover your family’s living expenses. Let’s say your annual income is Rs 12 lakh. Going by a rule of thumb of life insurance coverage being 15 times of annual income, you need life insurance of Rs 1.8 crore. The second step is to find out the life insurance coverage required for you to cover financial obligations, such as your kid’s higher education and any outstanding loans. Suppose, the sum total of your financial obligations is Rs 50 lakh, you would need total life insurance coverage of Rs 2.3 crore (sum of Rs 1.8 crore and Rs 50 lakh).
- Step 2
Compare term insurance plans Make it a point to compare the essential term insurance product features online, such as the maximum coverage and the duration for which you need to pay the premium. Also, find out whether the term life insurance companies have been in the business for long and look like being there for the entire tenure of the plan, which could be as long as 30 years. You also need to find out the insurance company’s claims settlement ratio. That indicates the number of term insurance claims settled vis-à-vis the total number of claims.
- Step 3
Consider riders to widen risk coverage Term plans allow you to attach riders that cover other risks to your family, such as those from accidents and critical illness. Since the riders come at affordable premiums, it’s worth attaching them to your term plans. You will have a wider coverage of risks and provide better financial protection to your family.
Buying online term plans provides you with immense convenience. Yet, you still have to make sure that you choose the term insurance plan and don’t miss out on the essential details.Since it involves securing your family’s future, you wouldn’t mind that little extra effort, would you?
How Long Should Be The Term Of Your Term Plan?
The tenure of your term plan is as important as the amount of premium you pay. The longer the period of term insurance policy, greater will be the policy’s annual premium. If you keep the period too short, there are chances that you would be without a cover in a period when your loved ones will still need financial protection. Therefore, it makes sense to consider important factors like the tenure of your term plan when you are buying a term plan in India.
The function of term life insurance is to help your family members meet their regular expenses and future needs even in your absence. Therefore, the ideal term of an online term insurance plan should end at a time when you have met all your life goals and saved enough for retirement.
It is typically difficult for you early in life to determine till when you will have accumulated enough savings to take care of all your needs for the rest of your life. This is the time when you will not need life insurance coverage. Since many of your large expenses such as your child’s higher education and marriage are likely to happen in your 40s and 50s, it makes sense to have your term life insurance coverage all the way upto your retirement at the age of 58 or 60.
Of course, there are people who aspire to, and there are some who actually do, retire much earlier, say, in their 40s. The guiding principle remains the same. You keep the life cover as long as you don’t have enough savings to take care of you and your family for the rest of your life.
Why taking the longest tenure, early in life makes sense. A smart approach is to buy the term insurance plan early on in life, opting for the longest possible coverage. This ensures you benefit from the low premium during the long tenure of the term plan. For instance, at the age of 25 you can take a term of 40 years as it would last till age 65. In this case, you would enjoy the low premium till the end of the term. Of course, as your income increases and lifestyle gets enhanced, besides you taking up loans, to cover all of them, you will need to periodically enhance your term life insurance cover.
To sum it up, it is not only important for you to have adequate life insurance coverage but also to ensure that it stays that way till the time your family needs it. It is your responsibility to ensure that your family is financially prepared to face any eventuality.
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Expenses won’t stop in your absence. Why should the monthly income? Provide monthly income of Rs 50,000 at less than Rs 23/day to your family in your absence
BUILD A PLAN
Term insurance is a specific type of insurance plan that provides life cover for a specific time period or ‘term’. If anything were to happen to the insured during the policy tenure, or during the term, the nominee will be provided with the sum assured.
A term insurance rider is an attachment that provides you with supplementary coverage for a fee. A rider can strengthen your overall term policy by providing numerous additional benefits over and above what your term insurance plan already offers.
Yes, term plans offer tax benefits under two different sections of the Income Tax Act. The premiums paid for the upkeep of either yours, your spouse’s or your children’s term insurance plans, up to a maximum of INR 1,50,000 per year, are eligible for tax deductions under Section 80C of the Income-tax Act, 1961 (‘the Act’). Additionally, the death benefit that your nominee receives is also exempt from income tax under Section 10 (10D) of the Act.
As with most insurance policies, it’s always best to buy a term insurance plan when you’re young and in relatively good health. This will allow you to get the best possible cover at an affordable rate. Depending on the term plan you would like to purchase, you need to be at least 18 or 25 years at the time of purchasing the policy and no older than 65.
While purchasing your insurance policy online, you may be required to upload copies of the following documents:
- Age proof (PAN card, voter’s ID card, passport, driving license, school/college leaving certificate, birth certificate)
- Address proof (utility bill, passport, voter’s ID card, telephone bill, ration card, electricity bill, bank account statement, letter from a recognised public authority)
- Photo ID proof (driving license, voter’s ID card, passport, PAN card, AADHAAR card, letter from a recognised public authority with a picture verifying identity and residence)
- A recent passport-sized picture
- Income proof (salary slip, Form 16, ITR/assessment order, employer’s certificate)
The ideal life insurance cover which should be at least 5-10 times your annual income. Simply put, you should have enough life insurance or term insurance cover so that your family can cover the liabilities and manage for at least 5-7 years without your income.
People have enormous faith in the life insurance cover that their employer provides for them. Our research insights tell us that cover provided by the employer typically is equal to the annual income. This isn't adequate. Also, this insurance lasts as long as you are employed with the organization. If you change jobs, start a company of your own or become a freelancer, you won't have the same insurance cover. If these events happen when you are older, the cost of insurance will be higher too. In such cases term insurance policies are advisable.
Your insurance policy should cover a person till the age he intends to retire. Till a few years ago, this was 60 years. However, in our new age we may have late marriages and having children at a higher age mean responsibilities do not end at 60. Experts suggest a life cover till 65 years, though it may vary according to circumstances.
We will not recommend you a short-term cover of 15-20 years that ends when you are in your 40s. The premium will be very low because you will be insuring yourself for the non-risky years. 40s are perhaps the time when you should have the best possible coverage. If you take fresh insurance at that age, it will be very expensive. You might even be denied a policy because of your health.
In case of any queries related to the online term plan or form filling pls call our toll free number 1800 266 9777 or contact us at Buyonline@HDFCLife.in
For submitting documents or any other query after premium payment, you can write us at email@example.com or call us on toll free number 1800 266 0315.
Post policy Issuance you can reach out our customer service desk on 1860 267 9999 (Local call charges apply) or write to us at SERVICE@HDFCLife.com
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