Sunday, July 10, 2011

Term Life Insurance


Term life insurance is also called as term assurance. It is a life insurance which provides coverage at a fixed rate of payments for a limited period of time, the relevant term. If the insured dies during the term, the death benefit will be paid to the beneficiary. Term insurance is the least expensive way to purchase a substantial death benefit on a coverage amount. Term insurance is considered the cheapest plan available in the market. It is a pure protection plan and basically designed to protect you from unexpected circumstances. It is suitable for those with not so normal health conditions and comes in three types with varied sum assured: level benefit, increasing benefit and decreasing benefit.
The first thing to be decided while buying a term insurance is the sum assured. This is arrived after considering the lifestyle and the current debts of the person taking it up. In the event of the death of the person the sum assured could be used to repay the debt. Term insurance does not give maturity benefit to the buyer. Nevertheless, one can buy riders to the term policies that could give premium on maturity. If the buyer dies before the maturity, the nominee gets the sum assured.









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