20 September,2022 03:55 PM IST | Mumbai | BrandMedia
A term insurance premium calculator is a beneficial tool that is used to calculate the premium amount of a policy. But before we understand what a term insurance calculator is, let us first know more about term insurance.
What Is Term Insurance?
A term insurance policy is a simple form of life insurance. You pay a premium for the tenure of your policy, and if you succumb to death during that tenure, then the sum assured is paid to your nominee.
It is a policy that can ensure your family's financial security even in your absence.
Let us first check the benefits of a term insurance policy.
Benefits of a Term Insurance Policy
a) Tax Benefit: A term insurance plan offers a tax exemption benefit. Policyholders can save up to 1.5 Lakh rupees in taxes under Section 80C of the Income Tax Act.
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b) Pay-out of Sum Assured: There are multiple options for receiving the sum assured from the insurance provider. You can choose a lump sum handout, or you can choose to receive the amount on a monthly or yearly basis.
Now that we have understood what a term insurance policy is, let us know what a term insurance premium calculator is, its benefits, and how it works.
Term Insurance Premium Calculator
Choosing the right term policy is important. To get the benefits that a term insurance plan offers, you need to pay premiums to the insurance company. A term insurance premium calculator can calculate the premium amount you need to pay in order to receive the benefits of term insurance. There are some details that need to be filled in the calculator. Let us see what they are.
a) Personal Details: First, you need to fill in your personal details like name, gender, smoking habits, policy term, the sum assured, etc.
b) Add Rider Benefits: There are many rider benefits that you can choose from, like accidental death rider or a critical illness rider. Note that adding a rider will increase your premium costs.
c) Check The Final Quote: Here, you can check the final quote of the premium. You can also go back and re-calculate the sum assured if it does not fit your budget.
Benefits of a Term Insurance Premium Calculator
a) Time Saver: Previously, getting a quote for a term insurance policy was a lengthy process that involved filling up paperwork. With a term insurance calculator, you can get an approximate idea of the premiums for your plan before choosing a plan.
b) Comparison Between Multiple Plans: One important benefit of a term insurance calculator is the option of comparing multiple plans. With the help of this option, you can check the premium costs of multiple plans before choosing the best option for yourself.
c) Budgeting: Now that you have a better idea as to what your premium will be. You can budget your finances accordingly.
d) Helps you make an informed decision: A term insurance calculator will give you a better idea of the sum assured that you can receive, which will help you make an informed decision about your finances.
Conclusion
As you can see, a term insurance calculator is a helpful tool. Therefore, if you plan to purchase a term insurance plan soon, then you must use a term insurance calculator for your benefit.
