Term insurance


Term insurance is a pure protection plan with no form of savings or investment. It is a plain-vanilla life insurance policy that covers the life of an individual for a specific term.

Today, most insurers offer term plans for up to 60 years with the cover ceasing when the individual attains 75/80 years. If the policy holder dies during the tenure of the policy, the benefit, that is, the sum assured is paid to the beneficiary. On the insured surviving the policy term, no benefits accrue to him/her.

If you want a saving component added to your insurance policy, you should look for endowment insurance covers, which come as participating and non-participating plans. Term insurance is the cheapest of all life insurance policies in the market.

For instance, for a 30-year male, the premium for ₹1 crore sum insured policy is ₹13,000. For this same premium, the cover he may get from a bundled insurance product will be very minimal.

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