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What is a term plan?
A term plan is a life insurance plan which pays out money in the event of death of the policy holder. These policies allow the policy holder to get coverage amounts as high as 1 cr. starting at prices as low as Rs. 500 per month.
Will my premium increase every year?
No, once the premium is fixed it will remain the same throughout the policy. The only case where premium can increase is if the government changes service tax.
What all causes of death are covered in a term plan?
Term plan covers every type of death. The only type of death which is not covered if the customer commits suicide within 12 months of the issuance or revival of the policy.
Should I buy my own life insurance even if my employer covers it?
Yes, if the liability is higher than the existing cover.
Can nominee be changed after the policy is issued?
Nominee can be changed anytime during the policy.
Is it safe to buy insurance online?
It is 100% safe to buy insurance online. The payments are made through a secure portal by you itself and the payment gateway is open for 180 seconds only for the security purpose.
Are online plans cheaper?
Yes. The premium of an online Insurance plan is discounted and comes out to be quite cheaper than the offline plans.
What is the right cover amount for me?
A term plan is responsible to cover your families needs incase of your death. The cover amount should be high enough such that it replaces your income. For example if you earn Rs. 5lakhs/month, the amount should be enough to replace your income. For example, If you choose to go with a cover of Rs. 70 lakhs, your family will receive this amount on your death. This amount can be invested at 8% per annum to generate ~5 lakhs/month thus replacing your income. Over and above this you should cover your existing liabilities – like home loan, car loan etc. For example if you have a home loan of Rs. 30 lakhs, then the total cover you should go for a total cover of Rs. 1 cr. – 30 lakhs to cover your home loan and 70 lakh to replace your income and provide adequate support to your family. What does cover amount mean? Cover amount is the amount that will be paid out in the event of the death of the policy holder. This amount will be paid out to the person nominated by the policyholder.
Why should I buy a term plan now?
One of the factor that affects cost of term life insurance is your age. The sooner you buy it the lesser it will cost you and you will get a longer cover.
Can I discontinue or surrender my policy?
You can discontinue paying premiums any time that you like. However it is recommended that continue to stay protected.
Why should I need medical tests for term plans?
Medical tests help the customer ascertain the risk and is thus required for policy issuance.
What does payment term mean?
Payment term is the period for which the policyholder has to pay the premiums. It can be Single, Regular and limited.
What is the claim settlement process for Term insurance?
Nominee has to be submit Policy bond, Death certificate and Nominee ID proof. Process can start by these primary documents. Additional requirement can be raised by the company.
What is the correct cover period for my term policy?
Customer needs to opt the cover according to his liabilities and depandency of family members on him.
What all add ons are available with a term plan?
Critical Illness, Disability, Aciidental death, Waiver of Premium, Terminal Illness, Hospitilization cancer and spousal covers.
Can I transfer my plan from one company to another?
No, portibility is not applicable in Term plan.
What can I do if my claim gets rejected?
Nominee can go to the Insurance company Grievance team and even if the issue is still unresolved, nominee can approach consumer court.
Which company has best claims settlement ratio?
Claim Settlement ratio varies every financial year.
Why is buying term insurance important?
Term plan is the most important insurance which every earning member of the family should buy. We are taking this Insurance for our family and not for us. Term insurance is a primary investment in our financial planning. If we care about our family and love them, our first priority becomes our family protection. We have maintained our family lifestyle according to our current earning situation, so we will definitely want give them the same lifestyle even if we are not there.
Are there benefits in buying a term plan online?
In offline mode, customers have to pay higher premium because of branch cost and agents commission. Moreover the benefit of online is the lower premium and also transparency. Customer is aware of all the information which you will be providing in the form and also the claim settlement is hassle free.
What if I forget to pay my premium, will my policy lapse?
Grace period of 15/30 days will be given to pay the due premium without any extra cost.
Can I stop my policy at any time?
Yes, but the risk cover will terminate.
Am I eligible for buying term plan?
If a person is earning and can show a income proof, he can take a Term plan.
Usually till what age do people take cover up to and why?
Ideally, one must buy a term plan for duration sufficient enough to cover himself till his earning age (retirement) so that he is able to provide financial independence to his family in maintaining their living and life style in case he is not there to provide for them anymore.
Is the medical compulsory?
If the company raises the medical requirements, it becomes necessary to undergo the medical test.
Can I buy a plan if I have an existing term plan?
Yes, but the cover should not exceed the eligibility limit.
What is Total Payout?
Total Payout under Term plans is the total amount that the nominee shall receive in case of death of the life insured.
What are TROP Plans?
Term Insurance with Return of Premium) TROP plans or the return of purchase price plans give back the premium amount at the end of the policy term; these plans are relatively more expensive than regular term plans.
Will I be covered outside India or if I become NRI?
Yes, every insurance company covers across the globe. Even if the customer gets citizenship of any other country or becomes NRI, he/she will be covered under the same plan.
Why company is doing medicals?
Medicals are performed to make sure that the details provided by the customer under the policy form are authentic.
Can I restart my lapsed policy?
Yes, within 2 years which is called Revival period.
What are tax benefits offered by term insurance?
Buying a term insurance policy gives you tax benefits under section 80(C) and 10(10d).
When will my life insurance cover begin?
Your coverage will begin only on acceptance of your proposal form. A written confirmation would be sent to you in this regard
Want to change the nominee?
You can change the nominee, any time in the policy term. This change can be made by writing to the insurance company from the registered email id.
Can I add more than one nominee?
Yes you can add more than one nominee. You can add additional nominees when filling up the proposal form or by sending additional nominee’s details from your registered email.
Can a diabetic person get a term plan?
Yes, diabetics can be covered by a term plan. However, this needs to be disclosed to the insurance company and may attract higher charges.
If I quit smoking a few years down the line, can I get my risk assessment done again and get a lower premium?
Once you have booked your policy under smoker category, you will not be able to get re-assessed for non-smoker category and the policy will continue with the same premium.
Death due to natural causes is also covered? Or only accident/ terminal illness?
Yes. Term plans cover every death scenario except for first year suicide after purchase or latest revival.
What is Key man insurance? Which companies provide Keyman insurance in India?
Key person insurance is life-insurance in which the key person in a business. like the owner, the founders or perhaps a key employee or two are covered. Every Life Insurance company provides key man Insurance. Customer needs to submit a Key man Insurance form to the Insurance Company.
What exactly happens when I add Spouse details in tern insurance?
Yes, spousal cover is available like in PNB and Aegon, in which the Spouse is covered to a specific limit of the Primary holder’s cover.
What needs to be done if the policy documents are not available with the Nominee?
Nominee can get in touch with the insurance company and get help regarding the policy documents. However, nominee’s ID proof is mandatory to start the process.
Can I switch from one plan to another with the same insurance company during the policy period?
Changes can be done before the Issuance of the policy. Once the Policy is issued, such changes cannot be done.
Is term plan the same as endowment plan or traditional life insurance?
No. In Term plan there is a huge death benefit and no maturity benefit, however, in traditional plans, there is a small death cover.
What are the Mandatory Claim Documents for a Un-natural death required to process the claim?
Once you have booked your policy under smoker category, you will not be able to get re-assessed for non-smoker category and the policy will continue with the same premium.
What happens if I don’t clear the medical test? Will my premium be refunded?
The policy will not be issued. However, the premium paid by the customer will be refunded in 7-10 working days. Some Insurance companies may deduct a small medical charge.
What is the difference between term plan and traditional life plans?
Term plans covers only death ie. Money is given out only in case of death of the policyholder and one can get a term plan of about 1cr for less than Rs. 500/- per month. Traditional Life Insurance plan is a form of an investment plan with a small life cover. The premium paid is invested and on maturity the principle amount and the interest is paid to the policy holder.
What is claim settlement ratio?
Claim settlement ratio is the number of claims accepted by the insurance company / number of total claims submitted to the insurance company in one financial year.
Is there a refund policy?
Yes. 100% guaranteed refund if you choose to cancel before the policy is issued. Money will be refunded in the rare case that the insurance company doesn’t issue the policy. If in the middle of the policy you aren’t happy with the service you can choose to discontinue the policy anytime by ceasing to pay the renewal premium.
Does this save tax?
Yes, under section 80©.
Is there a risk in buying a plan online?
There is no risk in buying insurance online. Moreover Policybazaar provides support for the complete issuance and at the time of claims settlement.
Which is the best term plan in the market?
Term plans are not one size fits all and depends on the needs of a customer. There are some parameters which customers should consider while choosing a plan 1. Claims settlement ratio – choose an insurer which has a good history of processing claims 2. Brand – You are buying a term plan to feel more secure about your future. Go for a company which has good brand value associated with it. 3. Flexibility – There are many add-ons which you can supplement your plan with. Choose a company which provides the widest variety of add-ons.
How much sum assured should I choose?
A term plan is responsible to cover your family’s needs incase of your death. The cover amount should be high enough such that it replaces your income. For example if you earn Rs. 5lakhs/month, the amount should be enough to replace your income. For example, If you choose to go with a cover of Rs. 70 lakhs, your family will receive this amount on your death. This amount can be invested at 8% per annum to generate ~5 lakhs/month thus replacing your income. Over and above this you should cover your existing liabilities – like home loan, car loan etc. For example if you have a home loan of Rs. 30 lakhs, then the total cover you should go for a total cover of Rs. 1 cr. – 30 lakhs to cover your home loan and 70 lakh to replace your income and provide adequate support to your family.
What does cover upto age mean?
Cover up to age is the age of the policyholder till which the policy is valid. Once the policyholder exceeds this age, on death the nominee will not receive the cover amount. We recommend going for high cover upto age. Companies like Aegon offer plans which cover the holder for the entire age.
Can coverage period be changed after policy is issued?
Coverage period cannot be changed once the policy has been issued. However you can choose to discontinue paying premium for the policy and start another one with the correct coverage period.
What documents are required to buy a term plan?
ID proof, Age proof, Address proof, Income prrof and self attested passport size photo
How can I buy term plan online?
Buying term plan online is very easy. First decide how much cover you want to go for. Then compare prices offered by various insurers. Once you have decided an insurer – click on them
Why should one take Term Insurance?
Term insurance helps protect your family from a financial shock in case of death. For example if you earn Rs. 5 lakhs/month and buy a 1 cr. term plan for Rs. 500/month. In the unfortunate case of your demise your loved onces will get a lumpsum amount of Rs. 10 lakhs. This amount invested at safe interest rate of 6% per annum. Your family will receive ~Rs. 50 thousand/month.
Which is better LIC or private companies?
It totally depands on the Customer’s needs. Although paying a extra cost in a Term plan is not beneficial for the customer.
Why am I asked if I smoke or use tobacco products?
The premiums will be higher for a smoker as the they have a risky lifestyle.
Can I insure my family members in the same plan?
No, as the Term plan is an Individual plan.
How long does claim settlement take and what is the process?
Nominee has to provide all the required documents. Company try their best to settle the claim as early as possible, although the maximum time is 6 months.
What is a counter offer?
It is the extra cost for covering the extra risk on a customer profile like medical risk/ Lifestyle risk/ Medical risk.
Which insurer should one go for?
It strictly depends on one’s requirement basis Death cover, Policy coverage and extra benefits like Riders or Add ons.
How to make sure, claim is not rejected?
Customer should disclose all the facts in the correct manner so that the claim will not be rejected.
What are riders or add-ons? Which ones are important?
Riders are extra benefits which allow you to buy a higher sum assured at a much reduced premium at the same time providing you coverage against some specific risks like disability, Illnesses, accidental death etc.
Will a term plan cover me if I am travelling abroad?
Yes, every insurance company covers across the globe.
What sum assured am I eligible for?
Eligible Sum assured is calculated on the current Annual Income and Age.
What cover amount can I take?
You should buy at least 20 times of your current annual income. This multiplier decreases as the age increases.
What riders are important?
Accidental Disability, Critical illness and Waiver of Premium.
Is it worth to buy term insurance for over 60 years of age?
Customer should buy the plan of his age till his liabilities gets over.
What is limited pay option?
Customer can pay the premium for a specific time period lesser than the Policy coverage term.
Why should I buy Monthly Income Term plans?
If your dependants are not financially literate & might not be able to judiciously use the lumpsum amount that they receive in case of your unfortunate death then you should opt for monthly income plans.
Are Private Insurers reliable?
Every company follows regulations made by IRDA. Regulations are not different for Private & Govt. Insurers.
Private companies will reject my claim?
Claim rejection is always on customer hand. If he will fill all information right in proposal form and did not hide anything from the company and also go with medical test during taking policy the claim will not be rejected.
What will happen if I do not pay the premium in Grace period?
Policy will be considered as lapsed.
Is terrorist attack covered under the plan?
Yes. Term plans cover every death scenario except for first year suicide after purchase.
Can I insure my spouse/children?
No. You can only insure yourself in this plan. However, anyone who is 18 years or above will be eligible if he/she is an earning individual.
If I cancel my policy will there be any deductions?
In case the customer cancels the policy in free look period, the premium paid by the customer will be returned after following deductions : Pro-rata risk premium (premium for the cover already used from issuance date till cancellation)Medical Expenses (If any)Stamp Duty Service Tax Administration Costs (Printing, paper, courier, etc).
Why you should purchase Term plans Online?
a) Easy and neutral comparison of product features/prices. b) Quotes from multiple insurance Companies. c) Smooth tracking of application status and claims documents. d) Comprehensive details about plans reduce buyer dependence. e) Multiple payment options. f) Protection of personal data provided by customers. g) 24×7 support through website and on-the-go mobile apps. i) Ability to prioritize cases. j) Help and assistance in filing claims.
Can the nominee be a minor (Less than 18 years old)?
Yes. In such a case, along with a nominee, an appointee needs to be added who is above 18 as nominee is ineligible to receive claims directly.
Why do you need my medical details to issue the policy?
The medical and other requirements are determined based on the age, Sum Assured, term and details provided by you in the electronic proposal form. This is based on our underwriting guidelines and internal requirements. The medicals are fixed in advance through a prior appointment as per your convenience.
What happens if policy holder and nominee both die together? Who will get the claim amount?
Legal heir(s) to the policyholder will receive the claim amount.
Can I change the duration of cover after the issuance of the policy?
No, you cannot change the term of the policy after issuance. However, you can buy a new insurance later should you require an extended cover.
I am an occasional smoker. Do I need to declare myself as a tobacco user?
Even if you are an occasional smoker, you must declare yourself as a smoker.
Is a medical compulsory even if I buy directly from the insurance company?
Yes, medicals will be raised by the Insurance Company.
Is a medical compulsory even if I buy directly from the insurance company?
Yes, medicals will be raised by the Insurance Company.
Can I change my address and other details after buying a term plan?
Yes, customer can I change the address.
What kinds of payment modes are available for premium payment?
In online mode, Debit card, Credit card or Net banking all the three modes are available.
What happens if death occurs within one year after taking the policy?
Death claim will be given to the nominee. Risk cover starts from the date of Issuance.
Whats the procedure for the medical checkup they require ? Do all such policies require medical checkup?
The medical and other requirements are determined based on the age, Sum Assured, term and details provided by you in the electronic proposal form. This is based on our underwriting guidelines and internal requirements. The medicals are fixed in advance through a prior appointment as per Customer’s convenience. Insurance company will bear the medical cost.
How to make sure that claims settlement process is smooth and claim is not rejected?
At the time of buying the policy, customer need to disclose all his material facts to the Insurance company for the smooth claim process. Nominee also needs to submit all the required documents within the timelines to the Insurance Company.
Frequently Asked Questions
1. Am I eligible for loan benefits under this plan? No, this insurance plan provides no loan advantages under it. 2. What is the service taxes levied under the plan? All taxes and service taxes levied under this plan are as per the tax law amendments by the regulatory body or the current ruling authority. 3. What are the conditions for renewal of the plan? The insured can apply for renewal of his plan within 2 years from the due date of the first unpaid premium. In order to renew your term insurance, you shall be required to: Pay all the premiums due Agreeable proof of the life to be insured, and Payment in full amount equal to all the policy premiums due but unpaid till the effective date of renewal. 4. What is the benefit amount under Group I of Women Care Rider? Under the women care rider group I, a female insured is benefitted if she is diagnosed with any female organ malignant cancer. The benefit amount paid is 5% of the base sum assured which is subject to a minimum of Rs 1, 00, 000 and a maximum of Rs 10, 00, 000. Under the women care rider group II, a female is benefitted is she gives birth to a child with congenital disorders or surgeries, or, has some pregnancy complications. 5. Under what conditions shall are my premiums eligible to be waived off? All the future premiums of the insured are eligible to be waived off if he suffers from any permanent disability. The insured shall be considered as permanently disabled due to one or more impairments as stated below: Loss of Speech Loss of hearing ability in both ears Loss of or loss of use of any one limb Loss of eyesight of both eyes Loss of or loss of use of both limbs 6. How is the policy settled on cancellation during the free look up period? On cancellation of the policy during the free look up period, all the premiums paid under the plan are returned to the insured after making the required deductions of policy administrations charges, stamp duty, medical expenses, if any, etc. Max Bupa Heath Companion Family Floater Insurance Plan