Life is unpredictable and providing financial security for your family is something that you cannot ignore. Here comes the need for term insurance. It happens to be one of the simplest and cheapest means of securing a financial future for your family, in case you are not there.

What’s Special About Term Insurance?

It is a term life insurance covering a particular term or period. If the policyholder dies within the term, the nominee receives the sum assured. Term insurance is very simple and cheap. But it does not end here; it has become much more flexible with time, giving more options than ever.

Let us first know about the characteristics of term insurance, which makes it a preferred option:

• Cheap Premiums: Term plans have higher coverage with lesser premiums as against other life insurance policies.
• High Sum Assured: You can choose a sum assured that would be good enough to support your family’s financial requirements.
• Tax Benefits: One can claim the tax deductions for the premiums of term insurance under Section 80C of the Income Tax Act.
• Flexible Tenure: Decide according to your financial requirements for the tenure.
• Add-On Riders: Supplement your policy to acquire comprehensive coverage.

Customization: You can customize the term insurance plan according to your needs

Term insurance plans used to be utterly inflexible. They are now flexible and you can get a term insurance to suit your requirements. Some of the customizations include:

Coverage Term Options: The insurer now provides flexible terms which can be as short as 5 years or as long as up to 99 years of age. You can match the policy term with your financial goals, like saving for your child’s education or home loan.

Payout Options: A regular term plan pays out a sum amount. But many insurers have now come out with:

• Monthly Income Option: The benefit is received by the nominee in the form of the monthly income.
• Combination Option: The lump sum is one part of the sum assured, with the remaining part being the monthly income.

Life Stage Allocations: Life is dynamic and your commitments with finances would only change with time. Some term insurance plans help you increase coverage concerning life events like marriage or birth without making you go out to buy an entirely new policy.

Flexibility in premium payments: You would be able to choose how to pay your premium:

• Pre-payment: Paying throughout the policy.
• Limited Pay: Higher premium for shorter duration with the added benefit of lifetime cover.
• Single Pay: Single premium payback in one shot for lifetime cover.

Riders: Enhancing Your Term Insurance Policy

Riders are those add-ons that add value to the added benefits that come your way as part of your term life policy. They are more or less like pizza toppings, where you get to choose what will come close to what suits your taste and hence makes it richer. Adding riders to a policy costs but extends coverage cheaply. Now, let’s have a look at some of the most popular riders:

Accidental Death Benefit Rider: If the nominee dies by accident through the policyholder, then there is a supplementary payment that occurs because of this rider. This is just one way to be able to afford additional coverage against any form of accident.

Critical Illness Rider: Critical illness can exhaust your corpus quickly. In the event of a critical illness, this rider pays out a lump sum, meaning in cases such as cancer, heart disease, or kidney failure, it can be taken for treatment, lifestyle adjustment, or as per any financial need.

Waiver of Premium Rider: If the person suffers permanent disability or any severe illness, then paying the premium becomes impossible. This rider helps in waiving future premiums so that your policy remains active without burdening you financially.

Income Benefit Rider: This rider provides for a certain definite flow of income to the family members for a particular period and puts their finances in order even after death.

Accidental Disability Rider: In case of complete or partial disability arising out of an accident, an automatic payout is received to cover medical costs or loss of earnings.

Why Customization and Riders?

Flexibility in term insurance makes sure that your policy is not just a paper but a dynamic tool specially tailored to meet your needs. Here are some reasons why customization and riders can be considered:

• Comprehensive Coverage: You can ensure your term plan covers more than just death as riders help you cover critical illness or disability, also.
• Cost-Effective: You needn’t buy different policies to achieve this. You can add riders to your existing term plan at a fraction of the cost.
• Financial Readiness: Customization makes your policy align with your financial goals and life stages and provides the right coverage at the right time.
• Peace of Mind: This comes with the knowledge of securing the financial future of your family against any eventualities.

How to Select Best Term Insurance Plan

The best term insurance will be based on your present financial condition, future liabilities, and coverage options available. Some tips are as follows.

• Assess Your Needs: Calculate the cover amount based on family expenses, outstanding loan repayments, and future liabilities.
• Compare Policies: Through online websites, it is easy to compare all the term insurance plans.
• Get a feature comparison, premium, and claim settlement ratio of the insurer.
• Check the Flexibility: Pick a plan that can be customized with multiple riders.
• Read the policy document carefully for what is included and excluded as in the terms and conditions.
• To whom to turn: Consult your financial advisor to get sound advice for an appropriate term insurance plan under your requirements.

Conclusion

It’s more than a safety net when one gets term insurance’s a financial tool that adjusts according to the changes in the life needs. The flexibility of term insurance nowadays offers unprecedented customized options and riders in plenty. Be it securing the future of your family or preparing for some unknown challenges, the difference would lie in knowing what the features of term insurance are and making the best of the flexibility available.

It is not securing a policy only but ensuring that it is suitable for your distinct financial goals. Take time out to explore and understand the advantages and make rational decisions. But, after all, your family’s future will be worth that.