How Term Life Insurance has become the Need of the Hour

The beginning of a new decade has been more surreal than a sci-fi movie. Now that the whole world has been taken aback by the threat of imminent death, courtesy the novel coronavirus, countries are taking precautionary measures to contain the contagion. As on April 21, the virus has impacted more than 18,000 people, causing nearly 600 fatalities in the country.

As per the plan of action, the nationwide lockdown has been extended till May 3. The uncertainty of the situation has resulted in a spike in the demand for term insurance.

Term Insurance Plans amidst COVID-19

The world has braced itself to fight against severe circumstances. While we are mindful about the precaution, we are prepared to underwrite the cure too. This is where the need for an affordable, yet comprehensive term insurance is established. Dire straits such as the death of the bread earner (insured) in the family can lead to financial constraints. Having a term insurance guarantees financial leverage should anything as such comes to pass.

Term plans cover the insurer for a certain span of time. In the event of the death or disability of the insured during the policy term, the death or disability benefit is passed on to the nominee of the insurance plan. Term insurance plans are budget-friendly and come handy more than ever. As per the circular issued by the IRDAI, term plans cover COVID-19 deaths as well.

Benefits of Term Insurance

Term insurance is a popular insurance option for many owing to the plethora of benefits that it comes with. Although term insurance plans offer high life cover against cheap premiums, it is not as favoured as other insurance plans due to the lack of any maturity benefit.

However, there are several other benefits that you can sign up to by purchasing a term life insurance. Such benefits are listed below:

Financial Security

Term insurance guarantees financial security to the family of the insured if and when they are no longer around. The payout at the time of death or disability of the insured is capable of mitigating financial liabilities and fulfilling financial goals like funding household expenses, child's education, or marriage.

Easy Payout

Making a claim on term insurance is easy and there is much less hassle around the disbursal of the claims. In the event of disability or death of the insured, the nominee can simply file a claim and comply with the prerequisite formalities to get paid.

Term Insurance Raiders

There are various term insurance plans that allow you to pick add-ons for your existing plans. You might want to opt for an accidental death benefit, permanent disability cover or critical illness cover in order to widen the cushion of coverage. Various term insurance plans also come with 'Better Half Benefit Option' via which your spouse can enjoy 50% of the life coverage of the insurance (up to Rs. 1 Crore) without having to pay an additional premium.

COVID-19 is covered under the critical illness cover. Therefore, your insurance service provider covers you if you succumb to the virus.

Flexibility

The policyholder has the flexibility to choose the premium payment term options. The premium payment term can be anything between 5 to 20 years.

Range of Coverage

Term insurance can cover you up to a maximum sum assured of Rs. 1 Crore. Even in the absence of the breadwinner in the family, you can utilize the payout towards meeting contingent financial expense like children's education expenses, emergency medical costs, unpaid debts, expenses in regards to maintenance of household and more.

Considering the entirety of the situation, not only do you need robust term insurance, but you also must ensure that it covers you well enough to cater to your financial requirements in the long term. You may opt for a group term insurance plan. It is imperative to discuss your financial requirements in the backdrop of COVID-19 with your family and thus, zero in on an insurance plan. Explain the benefit of the coverage and the inclusions in the plan to your loved ones and prepare them in case you are absent in the future. As per Naval Goel (the CEO of PolicyX.com), this is the right time to invest in a term insurance plan that you can bank on.

Source: Sakshi Post