term insurance questions, FAQs on term insurance plan.
Published On Feb 16, 2022
Table of Contents
- Frequently Asked Questions About Term Insurance Policy
- 1. How do personal habits like smoking etc. matter while choosing a term insurance plan?
- 2. How does a term insurance plan vary from an accidental insurance plan?
- 3. Can the premiums change after a period of time?
- 4. How does term insurance differ from life insurance?
- 5. Are there no maturity proceeds available with term insurance?
- 6. Is the death of the insured person considered if she/he dies outside Indian Territory?
A term insurance plan is the one that offers detailed and assured financial security for the benefit of your loved ones. When it comes to choosing a term insurance plan, it is very important that you keep certain factors in mind. These are the factors that decide the overall benefits that will be accrued once you purchase the plan. Therefore, it is very important for you to have a clear understanding of the terms and conditions of the term plans that various insurance providers are offering so that you can take an informed decision while choosing a specific term insurance plan that meets your specific needs and requirements.
Frequently Asked Questions About Term Insurance Policy
Following is a list of the most important FAQs on term insurance:
1. How do personal habits like smoking etc. matter while choosing a term insurance plan?
The premium terms generally vary from a smoker to a non-smoker and these terms are generally higher for a smoker as she/he comes in a high-risk category.
2. How does a term insurance plan vary from an accidental insurance plan?
An accidental insurance plan specifically provides the death benefit in case the policy holder dies an accidental death. However, a term insurance plan includes death due to any reason, be it natural or accidental.
3. Can the premiums change after a period of time?
This depends on several factors like addition of riders or declaration of habits like smoking, drinking etc. or the declaration pertaining to a hazardous employment nature etc.
4. How does term insurance differ from life insurance?
A life insurance policy includes maturity benefits while a term insurance plan includes no such benefits and simply entitles the nominee(s) of the policy holder to the sum assured in the event of the policy holder's demise during the plan term.
5. Are there no maturity proceeds available with term insurance?
Many insurance providers now-a-days include the clause for return of premium, which entitles the policy holder to receive the paid premiums in the event of plan maturity, although this increases the payable premiums.
6. Is the death of the insured person considered if she/he dies outside Indian Territory?
Yes. Term insurance, once in effect, entitles the nominee(s) of the person even if she/he has died outside India.
Tax benefits under Section 80C are admissible for a term insurance plan to the tune of a maximum of Rs. 1.5 Lac in any given financial year.
Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.