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Secure your family’s future with our term life insurance plans. Apply now today to find the best coverage to get started.
| Car Loan Details | |
|---|---|
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Interest Rate (Monthly reducing balance) |
Starts from 8.70% p.a. |
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Guarantor Requirement |
Varies with bank |
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Pre-closure Charges |
Varies with bank |
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Loan Tenure |
1 year to 8 years |
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Processing Fee |
Depends on the bank |
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A life insurance policy is a contract between the policyholder and the insurance company. The insured pays a fixed premium at regular intervals, and in return, the insurer promises to pay a predetermined amount after a set period. Life insurance policies can be broadly categorized into two types: pure protection plans and savings plans.
Pure protection plans offer financial security to the policyholder’s family in the event of the policyholder’s demise. This type of plan provides a lump sum payment, ensuring that the family is financially supported during difficult times.
Savings plans are designed to help policyholders achieve their long-term financial goals. These plans not only provide life coverage but also come with added benefits, such as maturity benefits, bonuses, and investment opportunities.
Term life insurance provides a death benefit payable only if the policyholder dies within the policy term. The nominee can claim the death benefit after the policyholder’s death. If the policyholder survives the policy term, the coverage ceases without any maturity value. These policies can be enhanced with riders for additional coverage, such as accidental death benefits and critical illness benefits.
TROP is a unique term life insurance that offers a survival benefit. If the insured survives the entire policy term, all premiums paid (with GST) are refunded.
Whole life insurance covers the policyholder until 100 years of age, providing financial coverage throughout the policy term.
Endowment policies combine guaranteed returns with life coverage. These plans offer a lump sum payout on maturity and allow the nominee to make a death claim in the event of the policyholder’s untimely death. Some endowment plans also include bonus benefits.
ULIPs are wealth-building plans that combine investment and insurance. Policyholders can invest in various funds, such as equity, hybrid, and bonds, according to their risk appetite. These plans offer market-linked returns, a five-year lock-in period, loyalty additions, and options for partial withdrawal and fund switching.
Money back policies provide a percentage of the assured sum at regular intervals and return the remaining corpus with a bonus if the policyholder survives the term. In the event of the policyholder’s death, the entire sum assured is paid to the nominee. These policies also offer maturity benefits with lump sum payments.
Child plans ensure financial security for a child’s future goals using investment returns. These policies offer life cover to the nominee and fund the balance premium in the absence of the policyholder.
Whole life policies offer 99 years of coverage with extended family protection. These plans are ideal for policyholders with dependents, providing lifetime protection for the policyholder and their children.
Pension or retirement plans help build wealth for the non-working years of the policyholder and offer financial protection to family members. These plans come with various withdrawal options, such as lump sum payments, regular income, or both.
Children Life Insurance Policy: These plans combine savings and investment to meet children’s future financial needs, offering intermediate withdrawals or provision for withdrawal after the child reaches adulthood.
Group Life Insurance: Employers, banks, NGOs, non-banking financial organizations, professional groups, and microfinance institutions offer these policies to employees. Group life insurance provides financial support to employees’ families in the event of untimely death and may include critical illness coverage, disability benefits, and outstanding loan coverage for debtors.
Life insurance policies provide the policyholder’s family with long-term financial security in case of an emergency, ensuring they are financially protected.
At the end of the policy term, insurance companies may offer maturity benefits, depending on the type of life insurance policy.
In the event of the policyholder’s demise, the insurer provides financial support through a death payout. The entire sum assured, plus any cumulative bonuses, is paid to the nominated individual.
Life insurance policies guarantee a predetermined sum after a specified term, which can cover expenses like your child’s education and other future needs.
Policyholders can receive tax benefits on their premium payments under sections 80C and 80D. Additionally, they are entitled to tax exemptions under section 10(10D) according to current tax laws.
Annuity-based life insurance policies assist in preparing for a secure retirement by providing a monthly pension upon policy maturity.
Riders are add-ons to the base plan, such as waiver of premiums and critical illness coverage, allowing you to customize your life insurance policy to meet your unique needs.
Some life insurance policies, like ULIPs, savings, and endowment plans, offer wealth creation benefits in addition to protection. Depending on your risk tolerance, you can choose different plans to accumulate savings for your long-term objectives.
Certain life insurance plans offer the facility to borrow a portion of the policy’s value or the sum assured, based on the policy’s terms and conditions.
You can choose how frequently to pay your premiums based on your needs. Available premium payment options include monthly, quarterly, half-yearly, or annually.
Life insurance has evolved from being a luxury to a necessity, playing a crucial role in ensuring the smooth functioning of our lives. Despite the country’s life insurance penetration not yet matching its population growth, hundreds of new people enroll in various life insurance plans every day. Selecting the appropriate type of insurance can be challenging with the numerous options available from different companies.
The table below highlights and compares key aspects of various life insurance policies in India:
| Type of Plan | Policy Term | Maturity Benefit |
|---|---|---|
| Term Plan | 5 years to 85 years | Maturity Benefit is only accessible if the Return of Premium option is selected |
| Endowment Plan | 5 years to 35 years | Yes, when the policy's term expires |
| ULIP | 10 years to 20 years | Yes, when the policy's term expires |
| Annuity/Pension Plan | Entire life | Regular earnings until survival |
| Whole Life Insurance | Until you attain the age of 100 years | When you attain the age of 100 years |
| Term Return of Premium Plan | 5 years to 65 years | Benefits of survival on maturity |
*Note – The term varies from plan to plan, with the numbers mentioned above reflecting an overall average.
In today’s world, having life insurance is essential. Even if your partner has a life insurance policy and a group policy through their employer, it is crucial to secure a comprehensive life cover for yourself. While life insurance won’t alleviate emotional distress, it provides a significant financial safety net during times of need. The insurance market is currently teeming with a variety of insurance products and services. When selecting a life insurance policy, understanding its tax implications is imperative.
Under Section 80C of the Income Tax Act, if you are paying premiums for your life insurance policy or for the life of your spouse, children, or parents, you are eligible for a tax deduction. This deduction applies whether your child is a minor or not. However, to claim this deduction, the premium paid must not exceed 10% of the sum assured for policies issued after April 1, 2012.
According to Section 10(10D) of the Income Tax Act, 1961, the maturity amount received at the end of the policy term is entirely tax-exempt if the premium paid does not exceed 10% of the sum assured for policies issued after April 1, 2012, and 20% of the sum assured for policies issued before April 1, 2012. This tax exemption ensures that the policyholder enjoys the full benefits of their life insurance plan.
The Equated Monthly Installments (EMIs) that you will pay will depend on a few key factors.
The higher the loan amount, the higher your EMI will be. Similarly, the shorter the loan tenure the higher the EMI.
To calculate the EMI on your car loan, you can use the formula:
EMI=P×R×(1+R)N(1+R)N−1\text{EMI} = \frac{P \times R \times (1+R)^N}{(1+R)^N – 1}
where:
Manual calculations can be error-prone, complex, and time-consuming, so using an online personal loan EMI calculator is preferable. This calculator requires only a few basic details such as the interest rate, loan amount, and loan tenure.
Once these details are entered, the EMI amount is calculated instantly. Additionally, the calculator provides the total interest amount and an amortization schedule for easy reference.
Life insurance is not exempt from GST (Goods and Services Tax). The introduction of GST has impacted the life insurance industry, leading to an increase in insurance premiums from 15% to 18%. This change affects those paying premiums for health, car, and life insurance, resulting in a higher financial burden.
When life insurance companies calculate premiums, they consider several factors. Life insurance is a form of investment, and even low premiums can yield high returns over time. However, obtaining a life insurance policy with a low premium may not always be feasible as certain requirements set by the insurer must be met. Some individuals manage to secure similar life insurance policies at significantly lower costs. This is often because they have made wise life choices that enable them to benefit from lower premiums.
Following are the documents you will require to purchase a life insurance policy:
Choose the Right Policy: Start by selecting a life insurance policy that best fits your needs and financial goals.
Select Your Premium Payment Option: Decide between annual or monthly premium payments based on the policy’s terms and your budget.
Notify and File a Claim: In the unfortunate event of the insured’s passing, it’s essential for the nominee to inform the insurer and file a claim.
Submit Required Documents: To process the claim, the nominee must submit relevant documents, including a death certificate and identity proof.
Claim Verification: The life cover amount will be disbursed to the nominee only after thorough verification of the submitted documents.
Life insurance provides invaluable support in the event of the policyholder’s death, ensuring financial security and long-term well-being for family members. Here are key reasons why life insurance is necessary:
Financial Security for Family: Life insurance safeguards your family’s financial future, covering regular expenses and maintaining their standard of living after your passing.
Affordable Coverage: It offers high coverage at reasonable premium rates, allowing you to secure your family’s financial stability without straining your budget.
Comprehensive Protection: In addition to death benefits, many life insurance policies also cover critical illnesses, alleviating the financial burden of medical expenses.
Retirement Preparation: Life insurance can help ensure a steady income stream during retirement, contributing to your financial security in your later years.
Tax Benefits: Life insurance offers tax advantages under Sections 80C and 10(10D) of the Income Tax Act, 1961, helping you save on taxes while securing your future.
Corpus Accumulation: Over time, life insurance allows you to build a corpus, providing financial resources for future goals like purchasing a home or funding your children’s education.
Peace of Mind: Knowing that your loved ones’ financial future is protected during difficult times brings peace of mind, making life insurance a crucial component of your financial planning.
Choosing the right life insurance is crucial for your family’s financial security. When calculating the necessary amount of coverage, consider the following factors:
Assess Your Family’s Needs: Evaluate your family’s financial requirements, including total income and monthly expenses, to determine the appropriate coverage.
Account for Existing Debts: Ensure that your life insurance policy covers any outstanding debts or loans, providing peace of mind for your loved ones.
Use HLV Calculation: Utilize a Human Life Value (HLV) calculator to obtain an accurate estimate of the life insurance coverage you need.
Prepare for Medical Emergencies: Select a policy that provides sufficient coverage for unforeseen medical or financial emergencies.
Income Replacement: Choose a coverage amount that can replace your income, ensuring that your family can maintain their lifestyle in your absence.
Consider Life Stage Changes: As your life evolves, select a life insurance policy that adequately covers your needs at different life stages throughout the policy term.
Life insurance claims can be made under two main circumstances:
Additionally, claims may be made for rider benefits. Here’s how to navigate the claims process:
To file a life insurance claim following the death of the insured, follow these steps:
Notify the Insurer: Inform the insurance company about the death, providing necessary details.
Submit Required Documents: Provide the death certificate and a duly filled claim form.
Provide Original Policy: Include the original insurance policy and a discharge form.
Include Assigned Policy Deed: If applicable, submit the assigned policy deed.
Legal Proof of Claimant’s Entitlement: Offer any legal documentation proving the claimant’s right to the benefit.
Additional Documents: Provide any other documents requested by the insurer.
To claim your life insurance upon maturity, follow these steps:
Receive Bank Discharge Form: Obtain the discharge form from your insurer.
Complete the Form: Fill out the discharge form accurately.
Submit the Form: Send the completed form along with the required supporting documents.
Receive Benefits: Upon approval, you will receive the sum assured along with any maturity bonuses.
If you have rider benefits to claim, follow these instructions:
Pay Extra Premiums: Ensure you have paid the additional premiums for the rider benefits.
Follow Claim Procedure: Adhere to the specific claim procedure outlined for each rider.
Death-Related Riders: For death-related riders, follow the same process as the death claim.
Other Riders: For claims related to other riders, submit a signed claim form along with a copy of the policy.
The following are the documents required for initiating claiming procedures:
To claim the death benefit, the nominee must file a death claim. Follow these steps to ensure a smooth process:
Obtain Claim Intimation Form: Get the claim intimation form from your insurer for physical policies or apply online for digital policies.
Include Essential Details: Ensure the claim intimation includes crucial information such as:
Complete Required Forms: The nominee must fill out the necessary death claim forms and provide proof of death.
Submit the Forms: After completing the forms, submit them to the insurance company. The insurer will acknowledge the receipt of the death claim.
Gather Supporting Documents: Collect all required supporting documents to facilitate the claim settlement process.
Submit Documents for Settlement: Submit the gathered documents to the insurance company for the claim settlement.
Review Process: The insurance company will review the submitted forms and documents before making a claim settlement decision.
Life insurance policies provide financial security by insuring the life of the insured and offering a lump sum to the insured’s family upon their passing. With a variety of policies available from numerous providers, selecting the right life insurance has become easier. However, it’s crucial to analyze costs and personal needs before making an investment.
Several key factors influence life insurance premiums:
Additional Factors Include:
Calculating life insurance premiums involves several steps:
Collect Personal Information: Insurers gather essential details about the applicant, including age, gender, and lifestyle choices.
Evaluate Health and Lifestyle: Underwriters assess the applicant’s health status and lifestyle habits, which significantly impact premium rates.
Analyze Personal History: The insurer reviews medical information and past incidents to gauge risk.
Statistical Data and Actuarial Analysis: Actuaries use statistical models to evaluate the applicant’s risk profile.
Risk Assessment: The likelihood of the applicant making a claim is predicted; higher risk leads to higher premiums.
Mortality and Sickness Tables: Actuaries create tables based on historical data to estimate potential losses.
Modeling Risk: Using the tables, actuaries model the likelihood of illness or death during the policy term.
Determine Premium: The final premium is calculated based on the applicant’s risk profile, with healthier individuals typically paying less.
Key details about the grace period include:
The cash value component of life insurance plans includes:
Policyholders should be aware of the late charges that may apply to life insurance premiums. Here are the key details:
Penalties for Late Payments: Policyholders are required to pay penalties if premiums are not paid on time.
Variable Penalty Amounts: The amount of the penalty can vary depending on the specific policy and the insurance provider.
Policy Reinstatement: To revive a lapsed policy through reinstatement, policyholders must pay all outstanding premiums along with applicable interest rates.
Duration of Late Payment: Late payment charges are also influenced by the duration for which the premium payment is overdue.
Revival Period: A life insurance plan can typically be revived within five years from the last premium payment date.
To prevent late fees on life insurance premiums, consider these important points:
Choose Auto-Debit: Opt for the auto-debit option to ensure timely premium payments without missing deadlines.
Set Payment Reminders: Activate reminder notifications before the premium payment date to avoid delays.
Track Payment Reminders: Keep a close watch on premium payment reminders to stay on top of your obligations.
Opt for Annual Payments: Selecting yearly premium payments instead of monthly can help you avoid missing regular payments.
Life insurance policies may have different exclusions, but several common exclusions apply to most policies. Key exclusions include:
Criminal Activities: Death resulting from engaging in criminal or unlawful activities.
Man-Made Disasters: Death caused by man-made events such as war, riots, or civil disturbances.
Suicide or Self-Inflicted Injuries: Death due to suicide or any self-inflicted injuries.
High-Risk Activities: Death occurring while participating in adventure sports or dangerous activities, such as bungee jumping or rock climbing.
Sexually Transmitted Diseases: Death from HIV or other sexually transmitted diseases.
Illegal Intoxicants: Death or injury caused by the use of illegal drugs or intoxicants.
Waiting Period: Death occurring during the waiting period is typically not covered by life insurance policies.
The required amount of life insurance coverage varies based on income, expenses, and liabilities. Evaluating these factors helps determine the appropriate coverage amount for individual needs.
The average monthly cost of life insurance is influenced by factors such as policy type, age, health, and the sum assured. Typically, term plans are more affordable compared to traditional or unit-linked plans.
Term life insurance provides high coverage at lower premium rates, making it a cost-effective choice for those seeking protection for a specific period. In contrast, whole life insurance combines death benefits with savings, resulting in higher costs.
Term insurance premiums are primarily allocated to create life coverage, whereas other plans use part of the premium for various purposes, making term insurance more affordable and focused on pure protection.
Life insurance coverage starts on the Risk Commencement date, which is when the insurer approves your insurance application.
Non-participating policies do not allow policyholders to share in the company’s profits, while participating policies enable profit-sharing through dividends, which may vary based on investment returns.
During the free-look period, you can cancel your policy at no cost. After this period, canceling the policy may incur a small fee.
According to Section 10(10D) of the Income Tax Act, sums assured and bonuses received are generally tax-free, with some exceptions.
Single cover policies provide separate coverage for individuals, while joint policies cover both under one policy. Joint policies yield a single payout, whereas two single policies provide separate payouts.
It’s advisable to purchase life insurance in your late 20s or early 30s, though timing may vary based on the number of dependents and family health history.
Whole life premiums remain fixed, while term insurance premiums may rise if renewed after the initial term, as age is considered a risk factor.
Graded life insurance features lower initial premiums that increase yearly for a specified period before becoming fixed for the remainder of the policy term.
The surrender value is the amount refunded if the policy is canceled and is based on premiums paid and the duration of the policy. Some insurers offer loans against policies using the surrender value as collateral.
The free-look period allows policyholders to cancel within the first 15 days of purchase for a refund. Cancellation during this period is free, but a small fee may apply afterward.
Riders are additional benefits added to a policy, such as critical illness coverage, available for an extra premium.
You can verify the agent’s credentials by checking their IRDA authorization card.
Yes, you can purchase life insurance for your parents, depending on their age and health. There are policies specifically designed for older individuals or senior citizens.
A Money Back Plan combines insurance and investment, offering periodic returns during the policy term and a lump sum at the end of the term.
