Term Insurance

To buy term insurance online, you will need the following documents:
 

• Any valid identity and address proof: Aadhar Card, Central KYC Identifier, Passport, Permanent Driving License or Voter's Identity Card issued by Election Commission of India
  
  
• Any valid income proof: Audited Company Account, Audited firm accounts and Partnership Deed, Bank Statements, Chartered Accountant's Certificate, Foreign Bank statement, ITR / Form 16 / Assessment orders / Computation of Income, Mandi receipt / Form J / Agriculture records, Rent receipt and  Salary slip / Certificate

Yes, you can have multiple term insurance policies in order to ensure that your loved ones can achieve their life goals in the case of any unfortunate event. They can also manage to pay off liabilities such as loans in your absence.

Yes, the HDFC Life Term Plan covers issues related to health and death. There are riders that come with the term plan among which are the basic death benefits and health benefits that you can avail in accordance to your needs. Being the cheapest and one of the most affordable types of insurance available, term insurance plans serve to provide protection with a life cover for your family.

The critical illness rider can be opted for protection from a critical illness. In such a case, you will receive the sum assured upon diagnosis. This is in addition to the benefits that are to be received in case of death during the policy term.

In case of unforeseeable events within the policy term, the nominee that you chose while filing for the term insurance receives the death benefits. The nominee, who is also referred to as the beneficiary, receives a lump sum amount as part of death benefits.

It is a smarter move to invest in term insurance plans in comparison to traditional life insurance policies. While both cover the risk of premature death, the difference between term insurance and life insurance lies at the point of maturity.

A conventional life insurance plan with maturity benefits, like moneyback policies, endowment policies, retirement policies, etc., is typically 10 times its premium amount. From the perspective of wealth creation, such products provide 3% to 4% interest rate which is largely what you get had you kept your funds in your savings bank account. With term insurance policies your net gain is higher in comparison to a life insurance product that comes with a maturity benefit.

However, the choice needs to be on the basis of your life goals.

Other benefits that make buying a term plan a wise decision are:

Death Benefit: Even though term life insurance provides a death benefit in the event of the policyholder’s demise prior to the maturity of the term policy as opposed to life insurance offering both death and maturity benefit, the compensation offered by a term insurance policy's much higher.

Low Premiums: Term plans offer higher risk coverage on low premium but does not create wealth like life insurance policies.

Flexibility: It is a much simpler process to surrender term plans compared to conventional life insurance policies.

There might be instances when you would like the change the premium payment frequency.

“For example - If you have been paying your premium yearly, you might want to change it to monthly or if you have been paying your premium monthly, you might want to change it to yearly.”

With HDFC Life’s term insurance policy, you can change your premium payment frequency anytime.

Term insurance plans generally do not offer maturity benefits, so they do not have any cash value. Given this, it is not possible to cash out a term insurance policy. The policy will only provide a cash benefit in case something happens to the insured individual.

Yes. The premium you pay for the upkeep of your term plan, up to INR 1,50,000 per year, is tax-deductible under Section 80C⁶ of the Income Tax Act, 1961. Additionally, the payout you or your nominee receive will also be tax-free under Section 10(10D)⁷

Ideally, you should select a term for your whole life or one that will see you through until your retirement. You can purchase a policy when you’re in your 20s for affordable premiums in the coming years

Your decision should depend on your financial ability to pay premiums. If you can afford small regular payments, you can commit to a regular pay term plan. With this option, you can pay every month, quarter, six months or year. Conversely, if you can afford to payhigher premiums quicker, you can opt for a limited pay option.

Yes, many insurance providers will allow you to change the frequency with which you make premium payments toward your term insurance plan. But, you will only be able to make the change when the policy is up for annual renewal.

This depends on the type of plan you purchase. If you have a return of premium policy, the insurance provider will return the premium amount once the policy expires. Most regular term plans do not offer any monetary benefit at the end of the policy term if the insured survives.

If you happen to shift residence out of India after purchasing a term plan, you must let your insurance provider know about the upcoming shift in writing. The company will then confirm whether they will keep your policy active or not. Typically, they will keep your policy going as long as you pay the premiums on time. However, some policy providers will not cover risks in particular countries. So, make sure you document their approval before you move.

Term insurance policies provide your loved ones with financial security at a particularly difficult time in their lives. Additionally, depending on the term plan you choose, you can also secure your own financial future in case you’re diagnosed with a critical illness or you meet with an accident that leaves you permanently disabled.

The amount of coverage that you should ideally opt for in a term plan can be determined with the help of several parameters.

• Current Annual Income: The generally accepted thumb rule is 20 times your current annual income which more or less factors in all possibilities like life cover, high inflation, and the rising costs of living that helps to decide your overall term insurance plancoverage.
• Current and Future Financial Commitments: Outstanding loans and debts are yet another key factor that is considered when determining your term policy coverage. If you are the primary breadwinner of the family, you must opt for a large enough coverage that will secure your family, take care of ongoing and future financial obligations in your absence.
• Financial Goals: Factor in all liabilities that you need to meet in the future when deciding on the sum assured for your term insurance plans. The whole point is to make sure that your family is able to maintain their lifestyle and meet financial goals in the event of your sudden demise.
• Age at the time of Policy Purchase: You can use the term insurance calculator to reach a decision. 20x of current annual income if you are in your 20s, 15x of annual income if you are in your 30s, and 10x of annual income for those in their 40s. Remember to add any outstanding debt to this calculation too.

Duration of the Coverage: It is best to purchase young and opt for a maximum tenure of coverage on your term plans.

You can enjoy the following benefits with your HDFC Life Click 2 Protect Super policy depending on the plan variant and add-on covers you select:

• Death benefit paid to your nominee in case anything happens to you
• Accelerated death benefit paid in case of a terminal illness diagnosis
• Return of premiums if you outlive the policy term
• Waiver of premiums in case of a critical illness diagnosis or permanent disability

Yes. After you have purchased a term insurance policy, you are free to update the name of your nominee at any time. You may want to add a spouse after you get married or add your children as nominees as well.

It’s a good idea to purchase an individual term plan even if you’re covered under your company’s group policy. Group term plans often do not offer very high cover amounts. Individual plans, on the other hand, can be customised to suit your individual needs. You can decide your sum assured and how you’d like the payouts to be made to your nominees. Individual plans also offer continuous cover, which may not always be the case with group plans. If you happen to leave the group, you will no longer enjoy the life cover offered, which leaves you and your family with significant financial risk. With both an individual and a group policy, you can enjoy enhanced cover at all times, irrespective of whether you opt to change your job at any time.

With a term insurance policy, if the insured individual fails to pay the premium before the due date, the policy will automatically lapse. This means that you will have to forfeit all the premiums paid so far and the insurance benefits. If you would like to get life cover again, you will likely have to purchase an entirely new policy.

Term insurance policies mainly offer the nominees of the individual a death benefit. If you happen to outlive your policy, the policy will end so you no longer have life cover and in most cases, you will not receive any kind of maturity benefit. If you’ve purchased a term plan that offers a maturity benefit, then you will receive it once the policy term expires. Before the term expires, you have the option of converting your term life insurance policy into a regular life insurance policy. You can check with your insurance provider on whether this is possible and ask about the process for the same.

The term insurance policy that you choose will depend on your financial requirements. First, you must decide whether you want a simple term plan or if you’d like to get critical illness and disability cover as well. Next, you should look for policies that also offer maturity benefits, such as the return of the premium. Finally, you should look at the sum assured on offer. The sum assured that you opt for will depend on the number of dependents you have and the kind of lifestyle you’d like your family to enjoy in the future. Once you understand your needs and requirements, you’ll be able to select the right term insurance policy.

Term insurance provides financial protection to the family of the insured at an affordable rate. The insured pays out a premium to the insurance provider for a specified period, typically 10, 20, or 30 years. In return the insured gets pure life coverage without cash value accumulation, making it affordable and straightforward. Term insurance ensures that loved ones are financially secure in the event of the policyholder's untimely demise.

There is no minimum income required to buy a term insurance plan. However, you still need to show your income statements/bank statements to the insurer to help them understand your premium paying capability. Ideally, insurance coverage is a 10 to 20X multiplier of your annual income and accordingly coverage of the term plan is determined. It is important to maintain the coverage for the said term that the insured is comfortable paying the premium.

The best age for purchasing term life insurance is ideally your mid-20s or the early 30s. This is because around this age group you are young and healthy. As a result, the premiums are generally lower as the insurer perceives the risks to be lower as well. Nevertheless, individual circumstances, financial responsibilities, number of dependents, and long-term financial planning goals are all factors that influence your decision and life stage for buying a term plan.

No, the premium on a basic term insurance plan is not refundable. Quite contrary to other insurance policies, such as whole life or endowment plans, a base term life insurance plan does not have a cash value component. It does not have a savings component either.

If the policyholder survives the policy term, there is no payout or refund of premiums paid. You pay the term insurance premiums solely to get insurance coverage for the specified term.

However, you can explore the features of a TROP (Term Insurance with Return of Premium) policy where this option is available to the insured. TROP allows the policyholder to get his/ her premium back (excluding GST) if he/ she survives the policy term.

The suitability of a term insurance plan depends upon several factors. These include individual needs, preferences, and circumstances. In addition, you need to consider coverage amount, premium affordability, claim settlement ratio, customer service, and additional benefits if any. Hence, always research to find your best term plan. It is wise to consult a financial advisor if needed.

It is not possible to take a loan against your term insurance policy according to the Insurance Regulatory and Development Authority of India (IRDAI) guidelines. The same way even unit-linked plans are not eligible for loans.