With the increasing rate of inflation, it is crucial to create a financial backup for the family. Moreover, if an individual is a single breadwinner of the family, it becomes even more important to ensure the financial security of the family. The term insurance policy not only provides the right financial protection but also ensures that the family has adequate coverage to deal with the eventualities. Thus, it is always advised that an individual should buy a term insurance plan with higher coverage of Rs. 1 crore.
Read further to know why you should consider purchasing a 1 crore term insurance plan.
What is a 1 Crore Term Insurance Plan?
The term insurance policy provides death coverage to the family of the insured in case of any eventuality. It also ensures to take care of the financial liabilities of the family in the absence of the breadwinner of the family.
The 1 crore term insurance is a pure protection plan that provides a coverage amount of Rs. 1 crore to the beneficiary in case of the unfortunate demise of the insured person during the policy tenure. The 1 crore term insurance plan works as a financial safety net for the family and helps them to meet the liabilities and fulfill the long-term financial objectives of life.
The Thumb Rule!
While purchasing the term insurance policy, the basic thumb rule that one should follow is to choose a coverage amount that is 10-15 times the annual income. As one of the simplest forms of life insurance product, the term plan offers the benefit of higher coverage amount at a lower premium rate of Rs. 411 per month. Thus, make sure to follow this thumb rule while buying the term plan.
Other important factors that should be kept in mind are age, health conditions, annual income, dependents, etc. By considering all these factors equally, one can select the most remunerative plan as per their requirement and suitability.
Along with the benefit of providing financial security to the family, the term plan also works as an income replacement for the dependents in the event of the unfortunate demise of the life assured. Moreover, with a 1 crore term insurance policy an individual can assure to fulfill the financial liabilities of the family such as repayment of home loan, child’s higher education, payment of credit card bills, etc. even in their absence.
Is 1 crore Term Insurance Policy Enough?
Choosing a comprehensive policy requires a better understanding and proper planning of what the plan has to offer. Higher coverage of 1 crore provides an opportunity to accomplish financial objectives like taking care of a child’s higher education, assurance against vulnerabilities, securing the retirement year of your spouse, etc. To choose the most appropriate plan, it is important to evaluate the requirement. Also, make sure to consider the future aspects like inflation, loan repayment, paying credit card bills, etc.
While purchasing a Rs.1 crore term insurance plan, it is important to consider how much coverage will be sufficient enough to deal with all these aspects in case of an emergency. As the financial requirement of an individual differs from person to person, make sure to consider different aspects and make an informed decision.
The Win-Win Situation
Nowadays, almost all life insurance companies offer 1 crore term insurance plans or more. As a policy buyer, it is imperative to compare the quotes of these plans online and choose the plan as per their requirement. Moreover, it is important to check the policy exclusion and inclusion so that one has a clear idea of what the policy offers and in what cases the claims can be rejected.
The Bottom Point!
As per the insurance experts, it is always advised to purchase the policy at a young age, so that one can enjoy the benefit of maximum coverage at a minimum premium rate. Moreover, if a person is a single breadwinner of the family then buying a 1 crore term insurance policy becomes even more important to ensure the financial security of the loved ones in the long term.