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What is a Term Life Insurance Plan?


Term Insurance Plans – Affordable Yet Comprehensive That You Must Get!

Life is uncertain. While we can always hope for the best, it’s wise to be prepared for unforeseen circumstances. A term insurance plan helps in securing the future of your family and financial dependants in case of disability, illness or death. If an unfortunate event occurs to the policyholder during the policy term, the nominee receives the cover amount also known as a death benefit or sum assured.

The premium is calculated based on the individual's health, age, and life expectancy.


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Benefits of Term Life Insurance Plan


HIGH LIFE COVER AT LOW COST

Term insurance policies offer the highest life cover for the lowest premium amount. The sooner you buy a term plan the cheaper will be your premium.

Long Term Protection

LONG TERM PROTECTION

Term Insurance Plans provide longer protection for you and your family. One can choose a life cover up to the age of 80.

Financial Stability

FINANCIAL STABILITY

A term insurance plan secures your family’s future by providing financial stability even in your absence.



Tax Benefit u/s 80C

TAX BENEFIT U/S 80c

Life Insurance premiums paid are deductible from taxable income under Section 80C. The payment (maturity amount) received under an insurance policy is also exempt subject to conditions under Section 10(10D) of the Income Tax Act, 1961.

Add-On Benefits

ADD ON BENEFITS

Many term insurance plans offer a host of add on benefits and riders such as accidental cover, critical illness cover, etc.

Peace of Mind

PEACE OF MIND

A term plan gives comprehensive protection to your family which helps you live peacefully without worrying about the future.

Why Should You Buy a Term Life Insurance Plan?


For the main earning member of the family, the feeling of being secured even in a situation of an adverse event makes him confident and prepared for the future. This is one of the main reasons why you should buy a term insurance plan.

Here are 6 other equally important reasons why everyone should buy a term insurance plan:

  • It Provides Financial Security
    Every person who has financial responsibilities towards their family should consider the fact that they may not always be around. From household expenses to children’s education, everything can take a hit if the earning member passes away and one must take precautions to avoid a financial crisis in such a situation.
  • It is Economical
    You can buy a simple life insurance plan for a fixed term at minimal premiums and if anything happens to you during the term of the plan, the nominee can either avail the sum assured as a lump sum amount, as monthly installments or as a combination of both, depending upon the payout option chosen by the policyholder.
    It is also beneficial to get a life insurance policy at a younger age as your premium increases every year. For example, at 21 years of age, a non-smoker, a single individual would be paying a yearly premium of ₹7131 for a life cover of ₹1 crore whereas, a 25-year-old single individual with same lifestyle habits will be paying a yearly premium of ₹8186 for the same life cover.
  • Provides Tax Benefit
    All premiums are exempt from tax under Section 80C. The sum assured (maturity amount) received is also exempt subject to conditions under Section 10(10D) of the Income Tax Act, 1961.
  • Timely Payout
    Most of the term insurance policies are pretty simple and therefore the insurance companies don’t have to debate a lot about paying up the claims. If there is death during the term of the policy the nominee can get their claims easily without any hassles provided the nominee is done with the requisite claim formalities. IRDAI’s Insurance Laws (Amendment) Act 2015 also directs life insurance companies to compulsorily pay all claims made three years after the date of commencement of a policy.
  • Flexibility
    You can select how the policy proceeds can be disbursed in case of your death. Some term plans offer monthly payouts where the sum assured amount can be given as a family income benefit to provide the regular cash flow to your dependents.
  • Riders and Benefits
    Even though choosing the best term insurance policy is a simple process and most term plans provide basic life cover, some also come with the option of getting add-ons. For example, you can opt to add critical illness cover, accidental death benefit, accidental total and permanent disability cover, etc. to a basic term policy to make the plan even more robust and risk-free. Insurance plans like Edelweiss Tokio Life Zindagi Plus provide the Better half benefit that ensures enhanced financial security even in the absence of the main breadwinner. Under this benefit, after the death of the policyholder, a life cover will start in his/her spouse’s name. This will be 50% of the life cover of the policyholder, up to an amount of ₹1cr. The spouse won’t have to pay any premium and the nominee will also get the sum assured.

Steps to Buy a Term Insurance Plan Online

Step 1 >> Choose your plan

Edelweiss Tokio Life - Zindagi Plus

This term plan is an innovative and customisable term life insurance plan. It can offer double protection for your family with the Better Half Benefit option and also offers the below options:

  • Additional life cover for spouse
  • Top-up on premium
  • Increase in life cover as per life stages
  • Decrease in sum assured by 50% after turning 60
  • Lumpsum or monthly payout option
  • Waiver of premium for critical illnesses
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Edelweiss Tokio Life - Total Secure+

This term plan is a comprehensive online term insurance plan which provides protection that secures your family and also fulfills your need for critical illness insurance. Choose from the following benefits:

  • Customisable plan options
  • Payout on diagnosis of critical illnesses
  • Flexible premium payment and payout options
  • Tax benefits u/s 80C
  • Life cover till 80 years of age
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Edelweiss Tokio Life -
My Life+

This term plan is an online term insurance plan that provides life cover up to the age of 80 at an affordable rate. It is a protection plan that will secure your family’s future in your absence.

  • Payout flexibility for the nominee
  • Payout as monthly income for the nominee
  • Tax benefits u/s 80C
  • Life cover till 80 years of age
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Step 2 >> Determine your life cover

It is usually suggested that a term life insurance cover should be at least 10 to 15 times of your annual income and 15 to 20 times is an even be. If you have loans such as home loans, car loans, etc. then you should factor that in too.


You can use this simple formula to determine your ideal life cover:
Life Cover = [10 x annual income + total outstanding loans + other liabilities]

For instance, if your annual income is ₹ 15 Lakhs, it is ideal to buy term life insurance cover of at least ₹1.5 Crore, assuming that you do not have other liabilities. In case you have a home loan of ₹50 lakhs, include this amount in your life cover.

Step 3 >> Calculate your premium

The cost of term plan varies depending on various factors such as age, annual income, the amount and tenure of insurance coverage, health condition and whether you are a smoker/non-smoker. For example, for a 30-year-old single male, non-smoker for a policy term of 20 years with ₹1 crore life cover, the annual premium is ₹6202.
Click here to calculate your premium.

Step 4 >> Make Payment

You can opt from monthly, half-yearly or yearly mode of payment and choose from a list of payment options such as:

  • Credit Card
  • Debit Card
  • Netbanking
  • Online Wallets
Step 5 >> Fill the proposal form

You will be asked to fill out the proposal form with your details.

Step 6 >> Submission of documents

You will have to submit the following or more documents for issuance of policy-

  • KYC documents such as proof of name, address, identification and photo
  • Income proof

How can you save tax with a Term Life Insurance Plan?


All term insurance premiums are deductible from taxable income under Section 80C. The sum assured (maturity amount) received is also exempt subject to conditions under Section 10(10D) of the Income Tax Act, 1961.

Tax Exemption under Section 80C on Premium Paid:
The insurance premium paid in a financial year is eligible for deduction under section 80C of the Income Tax Act. An individual and a HUF, both, can claim this deduction under Section 80C. The premium paid by a taxpayer is eligible for deduction irrespective of whichever life insurance company you choose. Premium paid towards a life cover taken with any insurer that is approved by the Insurance Regulatory and Development Authority of India (IRDAI), is eligible for a Section 80C deduction.
To claim deduction under section 80C, the premium paid should not exceed 10% of the sum assured. Further, here it is important to note that covering the life of an individual with a disability referred to under Section 80U or a disease referred to under Section 80DDB, the requirement to claim the deduction under Section 80C is that the premium should not exceed 15% of the sum assured.
Save Tax with a Term Plan

Tax Exemption under section 10(10D) on claim amount received

The claim amount of a term life insurance policy is fully exempt from Income Tax under Section 10(10D).



Inclusions & Exclusions of a Term Insurance Plan


Term life insurance plans promise to pay a lump sum amount to the nominees of the policyholder in the event of death. While the policy brings you security and hosts of benefits, your term policy comes with a few inclusions and exclusions:


Inclusions


The nominees are provided with the sum assured as a lump sum amount or through the chosen payout option in the event of the policyholder’s death.

Tax deductions and exemptions are provided with under section 80C and 10(10D) of the Income Tax Act, 1961 and other prevailing tax laws.

Additional amount over and above the policy’s sum assured is provided if the event mentioned in the added rider is fulfilled.

Other facilities like loan facility for meeting any unforeseen financial requirement, extra benefits for a higher premium are included.

Exclusions


The term life insurance claim is rejected by the insurance company if the death has occurred under abnormal circumstances. In case the policy includes Accidental or Critical illness rider, the insurance claim is rejected if the death has occurred due to:

  • Accidental death because of driving under the influence of drugs or alcohol
  • Death as a result of participating in life-threatening activities like racing or trekking
  • Death due to any pre-existing medical condition not mentioned in the policy term
  • Death due to any illegal activity

Other exclusions for term insurance plans include:

  • Suicide within the first year of the term policy tenure
  • Death due to sexually transmitted disease not mentioned in the policy term
  • Any self-inflicted injury resulting in death
  • Death due to the consumption of illegal narcotics or drugs

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Reasons Why Buying Term Life Insurance Online Is a Good Idea


  • Lower cost : Most online term insurance policies are less expensive than their offline counterparts. This mainly because you are buying the policy directly from the insurance provider. In this way, there are no intermediary costs such as distribution and agent commission that get added to the premium cost.
  • Empowering the customer : Insurance companies give all the data concerning the insurance products, its features, tenure, and riders clearly on their site. Hence those clients who will influence an online buy to can get to this data effortlessly and settle on an educated choice. They never again need to rely on an agent or some other party with a vested interest to give them the important data.
  • Safe and secure payments : Online transactions to buy term insurance using net-banking, debit cards, credit cards or trusted online wallets are usually safe and secure. This makes the chances of fraudulent transactions less likely.

Why Us


Easy Claim Settlement Process

Our claim settlement process has 3 simple steps: i.e. Intimation of claim, Submission of documents & final step is a decision on the claim.


Winner of Multiple Accolades

Our term insurance plan Edelweiss Tokio Life – Zindagi Plus has won the ‘Innovative Product of the Year’ award at the Golden Star Awards 2018.

Frequently Asked Questions



  • Why should I buy a term insurance plan?

    For the bread earner of the family, the feeling of being secured even in a situation of an adverse event makes him confident and prepared for the future. That’s exactly, why you must buy a suitable Term insurance policy.
    A term insurance policy also lets you get a considerable amount of life cover at an inexpensive premium cost. You can also get aid during accidents and illness by opting for additional riders with your basic term insurance plan.

  • How much does term insurance cost?
  • What is the eligibility for term insurance?
  • Is natural death covered in term insurance?
  • How much term insurance you need?
  • Will I have a problem at the time of claim if I buy online term insurance plan?
  • Is it secure to buy a term insurance plans online?
  • What is the difference between term and endowment insurance plans?
  • Why is there a vast difference in premiums of various term insurance plans?

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