The need for insurance:
Wisdom demands that everyone should think a step ahead. It is with this intention; people take insurance policies so that it would provide some financial relief to the family. Perhaps the amount which the family got through the insurance policy would support the education of the children or clear some mortgage and so on. When you take a look at the various types of insurance policies you would find there are two main categories namely whole life insurance policy and term life insurance policy. As the very name suggest, whole life insurance provides coverage for the entire life term of the policy holder. The basic feature of this policy being; the nominee or the beneficiaries will get the sum assured only after the death of the policy holder.
Basic features of term life insurance:
On the contrary, this type of policy provides coverage for a specific term as mentioned in the policy. Initially purpose of the policy was restricted to provide benefit for a specified period of time. That means to say, if the policy holder does not survive till the duration of the policy the beneficiaries were paid the sum assured. If the policy holder lived throughout the term of the policy, the policy expires but the policy holder will not get any benefits. Many people preferred type of insurance cover because it was considerably economical and also provided the much needed financial security for the family.
Why people opt for this type of policy:
With the growth in insurance sector, many insurance companies have come up with attractive schemes of this version of insurance cover. Take for example return of premium term life policy. In this scheme, if the policy holder survives the duration of the policy then the insurance company will return the premium he has so far paid. This is a type of social security offered to the policy holder because at that age his earning capacity would have diminished and the return of the premium helps him to meet his old age financial requirements. The other notable version of this policy is the decreasing term. This is a policy where every year, the policy holder has the option to alter the sum assured. The premium payable depends on the revision made by the policy holder on the sum assured. This type of policy is very much convenient for people with budgetary limitations.
Which is the term life insurance suitable for you?
In so far as term based policy is concerned, the main aspect to be looked into is choosing the term. Whether you want the policy for 10 years or 20 or 30 years; you will have to decide. You can also browse and find out the various schemes available with different insurance companies. For this purpose, it is always advisable that you should seek the help of a reliable and experienced insurance agent or underwriters or even financial consultants. They would provide you the appropriate advice after taking into account your specific needs, budget and other related issues. They would also give you a detailed account of the various types of policies available with different insurance companies and that would help you to make the right choice of the insurance policy.