TERM LIFE INSURANCE

Term life insurance, sometimes known as term assurance, is a type of life insurance that offers
protection for a specific term, or finite amount of time, at a predetermined rate of payments.
The client must choose between forgoing coverage or maybe obtaining further coverage with
different payments or conditions after that time period has passed since coverage at the prior
rate of premiums is no longer guaranteed. The beneficiary will get the death benefit if the life
insured passes away within the period. On a basis of coverage amount per premium for a
particular time period, term insurance is often the least expensive way to buy a significant
death benefit.

Frequently Asked Questions

1. What distinguishes term insurance from life insurance?
A term insurance plan does not include maturity benefits and only entitles the policy
holder's nominee(s) to the sum assured in the case of the policy holder's passing during
the plan term, as opposed to a life insurance policy that does.
2. Do term insurance policies offer maturity proceeds? i
The clause for return of premium, which permits the policy holder to get the paid
premiums in the event of plan maturity, is included by many insurance companies
nowadays. However, this raises the payable premiums.
3. Are "Act of God" covered by term insurance plans?
Death related to an Act of God is not excluded unless specifically stated in the policy
document's exclusions.
4. Can I change the duration of Term Cover after the policy is issued?
No it cannot be changed once the policy has been issued.
5. How does smoking affect one's decision while selecting a term insurance plan? ii
Term insurance is a type of life insurance, and risk evaluations are what insurance firms
rely on. The insurers will charge you a greater premium if your chance of contracting a
critical disease is higher. You will have to pay a higher premium if you smoke than a non-
smoker policyholder.
6. Given that I already have life insurance via my company, why should I get a separate
insurance policy?
It may be advantageous if your employer provides life insurance for its employees. For
the protection of your family, you need a bigger sum assured because these coverage
are frequently insufficient. Additionally, after you leave your company, your employer's
insurance coverage ends.
7. What distinguishes accidental insurance from term insurance?
Only if the insured dies in an accident will the accidental insurance offer a death reward.
The term insurance coverage provides protection against all types of demise.
 8. What would transpire if the policyholder had two different term policies?
If a policyholder has two different term policies, the second insurer must be informed
about the first policy and must acknowledge the first insurer.
9. Can I switch my Term Plan to some other type of insurance later?iii
As one ages the needs also change, several term plans do come with the option to port
your plan to Whole life cover. It entirely depends on the terms and conditions of the
insurance provider.
10. What is meant by term insurance riders?
Term insurance riders are additions or attachments placed to a term insurance plan
that provide the policyholder with extra coverage and increase the usefulness of the
policy. In addition to the death benefit that is granted by the term insurance policy,
riders offer a number of other advantages.

ENDOWMENT POLICY
An endowment policy is essentially a life insurance policy that, in addition to protecting the
insured's life, aids the policyholder in saving regularly over a certain length of time in order to
be eligible for a lump sum payment at policy maturity, should they live through the policy term.
This maturity amount can be used to cover a variety of expenses, including retirement, a child's
schooling and/or marriage, or a home purchase. A life insurance endowment policy pays the
entire sum assured to the beneficiaries in the event that the insured dies during the policy term
or, in the event that the insured survives the period, to the policy holder at maturity of the
policy.

Frequently Asked Questions

1. What Riders Are Available Under An Endowment Plan?
The riders included in endowment plans are rider for Accidental Death Benefit, rider
for Benefits of Permanent Disability, rider for Benefit for Critical Illness, rider for
Benefits for Life Guardian, and Accidental Illness in accordance with the Guardian
Benefit Rider, the remaining premiums are paid on the policyholder's behalf in the
event of accidental disability.
2. Are endowment plans a risk free insurance option?iv
Since endowment plans are unaffected by market conditions, they do not deal with
risk. It can be a suitable choice if you want complete security over your investment
capital. This feature guarantees risk-free returns, so it may be evaluated based on
your risk tolerance.
3. Who Can Participate in Endowment Plans?
 Between the ages of 55 and 60, a person may apply for endowment plan insurance
coverage. Apart from this endowment plans are accessible to a wide range of people
beginning at age five or even younger.
4. Can Endowment Plans Benefit From Tax Breaks?v
If you want to reduce your tax liability, this is a smart option. Under section 80C of the
Income Tax Act, an investment made in an endowment plan is eligible for a tax
deduction of up to Rs 1.5 lakh. Additionally, under section 10(10D) of the Income Tax
Act, all gains made from it are tax-free. This will guarantee a smooth money
transaction in an emergency situation or during a currency shortage.
5. What Common Exclusions Are Included in Endowment Plans?
Like other insurance plans, endowment plans have a number of situations in which
the company is not required to pay for coverage. Any claim made under an
endowment plan that arises directly or indirectly from any of the following is generally
excluded, attempted or actual self-harm, involvement in unlawful activity, being drunk
or using drugs or alcohol to get high (exceptions apply), participating in dangerous
sports or activities and participating in any riots or other public unrest or Aviation Risk.
6. Can You Invest Long Term in Endowment Plans?
An excellent risk-free investment option for long-term savers is endowment
programmes. Popular endowment plans are used to build a future savings fund. The
regular deposits of premiums encourage long-term saving practices.
7. Are there Maturity Benefits in Endowment Plans?
According to the maturity benefits offered by an endowment plan, the policyholder
will get the lump sum payoff if they live past the maturity term. This feature sets an
endowment plan apart from others and ensures the security of the policyholder.
8. What is meant by Reversionary Bonus in Endowment plan?
Reversionary Bonus is money that is added to the balance owed with profit at
maturity or death. After being declared, a reversionary bonus cannot be withdrawn,
regardless of whether the insurance matures or the covered person passes away.
9. What is meant by Terminal Bonus in Endowment plan?
When an insurance policy reaches its maturity date or an insured person passes away,
the insurance company may choose to add a discretionary sum to the payout. Typical
time periods for this are 10 or 15 years, it is acknowledged as Terminal Bonus.
10. What is the tenure of Endowment Plans?vi
An endowment policy can last anywhere between 10 and 20 years. The five to ten-
year premium payment period. At the age of 18, you can get a term insurance policy.
The age at which someone reaches full adulthood is 75. As a result, 55 is the oldest
age at which a person may get a 20-year term insurance plan.
WHOLE LIFE INSURANCE
Whole life insurance, usually referred to as conventional life insurance, offers continuous death
benefit protection for the duration of the insured's life. Whole life insurance has a savings
component in which cash value may buildup in addition to paying a death benefit. A fixed rate
of tax-deferred interest is accrued. One sort of permanent life insurance is whole life policies.
Other terms include universal life, indexed universal life, and variable universal life. The first
sort of life insurance was whole life, but since there are many different kinds of permanent life,
whole life does not necessarily equate to permanent life insurance.

Frequently Asked Questions

1. The agent told me when I purchased my life insurance policy that it would be "paid
off" after ten years, yet ten years have passed and I am still receiving bills. Why?vii
There may be guaranteed interest rates and/or dividends the insurance company will
pay on your premiums according to the terms of your contract (insurance policy).
However, before your premiums "pay up" your policy, they must generate extremely
large revenues. Items that are promised in the contract must be backed by the
company. The promise of "paid up" life insurance is prohibited when it is based on
unreliable values. Your state's insurance department might be able to help if you have
proof that the agent made this promise. Any writing containing the promise would be
considered documentation, including a casual handwritten note or similar statement by
an agent.
2. Who can obtain a life insurance coverage on me?
An insurance policy on your life can only be purchased by someone who has a "insurable
interest." It follows that a stranger cannot purchase an insurance to cover your life.
Members of your immediate family are typically included in those with an insurable
interest. Your employer or business partner may occasionally have an insurable interest.
Institutions or individuals who end up being your biggest creditors may also qualify for
insurable interest.
3. When the insurance coverage is entirely paid up, what happens to the cash value?
The insurance provider intends to pay your premiums until you pass away using the cash
value. There might not be enough money left over to cover premiums if you subtract
cash value. The insurance company may demand that you resume making premium
payments or lower the death benefit so that it is compatible with the remaining cash
value.
4. I used to have a paid-up policy, but now I'm informed that I don't. What should I do?
 You might have authorized the use of your paid-up policy's cash worth to fund a larger
policy by signing documents. Call the insurance provider if you're unsure or can't
remember.

5. What is a participatory policy?

You could benefit from having that type of insurance. You have the opportunity to
"participate" in the profits of the business. In reality, a life insurance dividend is a partial
repayment of your premium. A corporation may issue dividends at the end of a given
year if it has received more premium money than is required to cover death claims and
keep the insurance pool in good standing.
6. What is the cash value of my policy?
Check out your insurance. It includes a table of cash values that ought to include the
solution. If you're still unsure about the cash worth, call your representative.
7. What happens to my insurance policy's cash value if I pass away?
The insurance provider will pay the death benefit after your passing. Your beneficiaries
may not receive more than the stated death benefit, regardless of the amount of cash
value you may have had in the policy at the time of your death. Your outstanding loans
(plus interest) will be deducted from your death benefit.
8. Are funeral expenses covered by life insurance?
Yes, Funeral and final expense insurance, a type of life insurance, does, in fact, pay for
funeral costs (final expenses).
9. Which types of life insurance have cash values?viii
Term life insurance normally does not offer monetary value, but permanent life
insurance, such as Whole Life and Universal Life, can. A loan for a policy is an additional
option. The only term life insurance that comes close to having cash value is term life
insurance with Return of Premium (money-back guarantee).
10. What's the complete life insurance application procedure like?
The application procedure differs from insurance company to insurance company.
However, the majority of application procedures need you to submit an online or paper
application. A few days after the application is received, an insurance company
representative will visit you. Your height, weight, and urine sample are checked first.
The insurance provider looks into your family history, prescription drug use, and medical
history behind the scenes. They will give you a rating once they have all of these details,
either accepting or rejecting it.
i
www.hdfclife.com

ii
www.exidelife.in

iii
www.coverfox.com

iv
www.insurancedhekho.com

v
www.economictimes.indiatimes.com

vi
www.canarahsbclife.com

vii
www.insureuonline.com

viii
www.annuityexpertadvice.com