Everything you need to know about Term Insurance Plan before buying one

May 19, 2022

Buying term insurance from a reputed bank or financial institution can make or break your game. For example- HDFC Term Insurance is one of the most popular and preferred term insurance plans in the market. But you can do your research and choose the one that ticks the boxes for you. Let’s find out the things you need to keep in mind while buying a term insurance plan.

Term insurance is a plan that ensures your family has some financial support in case of your untimely and unfortunate death. You can easily secure your family’s financial future when you are not around. These term insurance policies are very well known to be one of the most preferred types of life insurance plans to choose in today’s time.

A term insurance policy not just provides financial support to your family in the most unfortunate times, but it also has tax benefits that can help you save taxes. You can also easily avail yourself of various other benefits once you decide to buy a term insurance plan.

Factors that affect term life insurance premiums

  • Gender

Multiple studies show that women live a longer life than men. The life expectancy of a woman is five years more on an average as compared to a man, which means five years of extra premiums. That is why women are offered lowered term insurance premiums as compared to men.

  • Age

As the age increases, the risk of health concerns increases too. This is one of the reasons why lower insurance rates are offered to the younger policyholders/individuals above the age of 18.

The premiums increase as the age increases. This is why experts in this field recommend investing in a term insurance plan as soon as you can to make the most out of it. You can save a lot of money and even get affordable premium rates.

  • Current health conditions of family members

For individuals who come with a family that has a background of health conditions like heart diseases or cancer, the risk of that individual getting the same disease is higher. Because they are at a higher risk of developing diseases, a higher premium is charged.

  • Profession

The profession of the individual also plays a significant role in determining the individual’s health. If their current job is something risky like a sailor, soldier, pilot, etc., then they are required to pay a higher premium. It is because they are at a higher risk of suffering from serious ailments.

  • Current health condition

If the individual that wants to get a term insurance plan is suffering from pre-existing illnesses such as obesity, then it means he/she is at a higher risk of suffering from serious ailments. That is why they are charged a comparatively higher premium as compared to an individual who is physically fit.

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