Why term insurance is best bet for those seeking life cover

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Updated: Oct 05, 2020 7:09 PM

Term plans in fact are known as the most straightforward risk protection plans, with higher sum insured at cheaper premiums.

term insurance, COVID-19, millennials, secure future, ULIP, Unit-Linked Insurance Plan, whole life insurance, child plan, retirement plan, endowment plans, health insurance plans, buying, online, COVID-19 cover, premium, tax benefitThe battle against COVID-19 will be raging for months if not years, and under such a scenario, investing in term plans guarantees security for the family.

The Covid-19 pandemic has taught us well, especially, why it is more important than ever before to be covered by insurance. While having health insurance helps you avoid burning a hole in your pocket in case of medical emergencies, at the same time having a life insurance policy provides the dependents and family members of the policyholder financial help in case of any unforeseen situation.

In the current financial year, the trend for buying insurance is more accelerated than ever. Pankaj Chauhan, CEO, and MD, EPOCH Insurance Broker, says, “An insurance policy helps and protects the policyholder’s family if the breadwinner loses his/her job, falls ill, or in case of a severe accident. With a life insurance policy, many consider it as an investment vehicle.” Many people buy insurance not only to protect themselves and their families from adversity but also as an investment option.

Having said that, experts say, mixing the two, investment and insurance, is never a good option and people should keep it separate.

Industry experts say term insurance covers are the best bet for those seeking life cover. Term plans in fact are known as the most straightforward risk protection plans. They offer a higher sum insured at cheaper premiums. Hence, for a monthly or yearly premium, policyholders can get pure insurance cover.

These days, however, there are various other term plans that have been brought in by insurers such as, term plans with return of premium on policy maturity, etc. Chauhan of EPOCH Insurance Broker, says “Given the pricing and the popularity of the regular premium term plans in the said policy premiums paid for the agreed policy tenure are forfeited by Insurer at time of policy maturity. While this seems like a bad deal, it has some advantages. For a relatively small sum, a policyholder is provided with an insurance cover of up to 1 crore or more.” Hence, for policyholders who are concerned about their families, term plans are the ideal deal.

Experts say, in today’s time, investing in term plans makes greater sense than ever before. The battle against COVID-19 will be raging for months if not years, and under such a scenario, investing in term plans guarantees security for the family. Having the right insurance policy will help policyholders secure their families, in case the worst happens.

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