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Term Policy

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Term Insurance Policy: The Purest Life Insurance Plan

Enegineering Policy

What is a Term Insurance Policy?

A term insurance policy is one of the purest forms of life insurance, providing comprehensive financial coverage in case of the death of the insured. It is a contract between the policyholder and the insurance company where a fixed premium is paid for a specific period, and in case of death, the nominee receives a lump sum payout. Unlike traditional life insurance plans, a term insurance policy does not offer maturity benefits if the policyholder survives the term.

How Does a Term Insurance Policy Work?

Among all life insurance products, a term insurance plan offers the highest coverage at the lowest premium since there is no return on premium. Here's how it works:

Benefits of Term Insurance

  • The policyholder chooses a coverage amount and policy duration (term).
  • The insurer determines the premium based on the individual's age, health, and lifestyle.
  • If the insured person passes away during the policy term, the sum assured is paid to the nominee.
  • If the insured survives the term, the policy expires without any maturity benefit (unless a return of premium option is chosen).
  • Policyholders can enhance coverage with riders like critical illness, accidental death, or disability benefits.

Key Benefits of a Term Insurance Policy

High Coverage at Affordable Premiums

A term insurance policy provides significant life coverage at an affordable cost, making it accessible to everyone.

Financial Security for Family

In case of the policyholder's death, the nominee receives the death benefit, ensuring financial stability.

Additional Coverage with Riders

Policyholders can customize their term plan by adding riders for accidental death, critical illness, or permanent disability.

Tax Benefits Under Section 80C & 10(10D)

Premiums paid towards a term life insurance policy qualify for tax deductions under Section 80C of the Income Tax Act. The death benefit is also tax-free under Section 10(10D).

Coverage for Accidental Death & Disability

A term plan offers higher payouts in case of accidental death or disability through riders.

Flexibility in Payout Options

Nominees can opt for a lump sum, monthly income, or a combination of both as the death benefit payout option.

Financial Planning for Future Goals

The payout from a term insurance plan can help families cover education expenses, home loans, and weddings in case of an unfortunate event.

Types of Term Insurance Plans

Level Term Plan

A basic term policy where the sum assured remains the same throughout the policy term.

Increasing Term Insurance Plan

The coverage amount increases over time to keep up with inflation and financial responsibilities.

Decreasing Term Insurance Plan

Designed for those with large loans, where the coverage decreases as liabilities reduce.

Return of Premium Term Plan

If the policyholder survives the term, they receive back the total premiums paid.

Convertible Term Plan

Allows conversion to another life insurance policy (such as whole life insurance) during the term.

Factors to Consider Before Buying a Term Insurance Policy

Sum Assured

Ensure the sum assured is at least 10-15 times your annual income to provide adequate financial security.

Policy Term

Choose a policy duration that covers your family's financial needs until major responsibilities (like loans and children's education) are taken care of.

Premium Affordability

Compare premium rates across different insurers while ensuring adequate coverage.

Claim Settlement Ratio

Check the insurance company’s claim settlement ratio (CSR) to ensure hassle-free claims.

Riders & Add-ons

Consider critical illness riders, accidental death benefits, and waiver of premium riders for enhanced protection.

Insurer Reputation

Opt for an insurer with strong financial stability and a good customer service record.

How to Buy a Term Insurance Policy?

Step 1: Assess Your Insurance Needs

Determine how much coverage your family would need in your absence.

Step 2: Compare Different Plans

Use online term insurance calculators to compare premiums and benefits.

Step 3: Choose the Right Policy & Riders

Select the best term plan based on your requirements.

Step 4: Complete the Application Process

Fill out the application form accurately and disclose all health and lifestyle-related information.

Step 5: Medical Examination

Some insurers may require a medical check-up to assess risk factors before policy issuance.

Step 6: Policy Issuance & Premium Payment

Once approved, pay the premium and receive your policy document.

Why Choose Apex Insurance for Your Term Plan?

Apex Insurance offers:

  • Comprehensive term plans with maximum coverage at competitive premiums.
  • Customizable riders for enhanced protection.
  • Easy online purchase with minimal documentation.
  • Expert financial guidance to help you choose the right plan.
  • Get in touch with Apex Insurance today to secure your family's future with the best term insurance policy tailored to your needs!

We are ready to help you