Term Life Insurance Meaning and its Importance

In India we have different types of Insurance Policies. When compared to other foreign developed countries what we have is very less but still whatever we are having are very useful for us. These types will depend on the objectives and our requirement. Life Insurance is purely safe and secured. Investment is will help in financial planning also. Different Types of Insurance Policies that are available in India and its objectives are also provided below for reference.

Meaning

This is basic type of insurance which there will not any kind of special objective. . A renewable term life insurance policy is usually available in one to five increments. Term insurance has a guaranteed death benefit but no cash value as the premiums will increase at pre-determined intervals such as 1 year or 5 years or 10 years or 20 years depending on their capacity and availability. Term insurance is specially designed to help people in purchasing the protection they need when they cannot afford to purchase all permanent insurance. It will also help when they only need coverage for a specific period of time.

Importance

Term insurance will work depending on the type of policy we are holding. Profit corner is very less in this type of insurance. Premiums will be cheaper when compared to other types of provident funds. Depending on our premium we have to pay once in a month or once in three months and risk involved is also very less for this type of insurance. It can be renewed without the insured having to undergo a medical examination and no need to provide other evidence of good health each year. Level term policy is available which is to provide a fixed amount of coverage with premiums that remain stable over a certain period of time like five to ten year increments.

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