5 min read
A man earns his entire life for the sake of his loved ones. His family means the world to him. He struggles all day long only to earn bread for the family as long as he can. But what he sometimes fails to realize is who would earn bread for his loved ones when he’s not around? While working to make our present comfortable, it’s equally important to think and plan for the future, especially that of our family. This is where term insurance plays a significant part.
Term insurance plans are essentially pure risk plans which means that they are designed to cover the biggest risk of all, death. In case of an unfortunate and untimely demise of the sole breadwinner for the family, a term insurance plan provides financial coverage for their family’s needs. This ensures that life for the policyholder’s family still moves on without much financial trouble.
Now there are a variety of term life insurance plans available with different insurance companies in the market. You can make your own choice based on your budget and actual requirements. Here we discuss in detail the cost (premium-wise) of a 2 crore term insurance plan to help you make an informed choice for your family’s future.
As stated earlier, you may choose to invest in a term insurance plan worth any amount, based on your individual requirements and budget preferences. Of course, the higher the amount of coverage that you opt for, the better it would be to secure your family’s future optimally. However, note that while choosing the coverage amount for your term insurance, there are a number of factors that would need to be taken into consideration.
All of these factors would help determine the premium payable on that plan:
Now, based on a thorough assessment of all these factors taken together, the insurance company would calculate the exact premium amount that the policyholder would need to pay for the term of the policy.
If you wish to know the premium payable prior to buying the term insurance plan with an insurer, you can do so by referring to several online tools available. The online term insurance premium calculator can help compute the exact premium amount that needs to be paid for different term insurance policies of different coverage values.
Just how your insurer would calculate the premium for you after entering all the required details (mentioned above), you can do the same on this online tool and you’d get the premium calculated in a few seconds!
Now, to give you a clearer idea on the exact cost of a 2 crore term insurance plan, we have tried to explain through an example below how much premium would you actually need to pay if you chose to invest in a term insurance policy that promises a high-value coverage of 2 crores for your family after your death.
The values used for the purpose of this example are imaginary (only for your understanding) so we recommend determining the exact cost of the specific plan that you wish to purchase from the insurance company that you intend to buy it from. Your insurer would be able to tell you the exact premium payable for your plan based on an assessment of the various factors, as discussed above. However, this example is only for illustrative purposes, to help you make an educated choice.
Also note that the table below enlists the premium amount payable on the plan for different variants of the 2 crore term insurance plan that you may wish to invest in. Based on the type of plan that you choose, the premium amount would vary.
|Type of Term Insurance Plan||Sum Assured to the Beneficiary Upon Policyholder’s Death||Premium Payable Annually (GST Included)|
|Basic Life Cover Plan||Rs. 2 crore||Rs. 25,549|
|Fixed Income Protection Plan||Fixed monthly income of Rs. 83,000 assured after death, until the insured attains 60 years of age or for a term of 10 years, whichever is later||Rs. 12,841|
|Increasing Income Protection Plan||Fixed monthly income of Rs. 125,000 payable after death, until the insured attains 60 years of age or for a term of 10 years, whichever is later. Income increases by 10% annually.||Rs. 43,200|
|Basic Life Cover + Fixed Income Protection Plan||Rs. 2 crore paid in a lump sum upon death; Rs. 30,000 fixed income paid monthly until the insured is 60 years old or for a term of 10 years, whichever is later||Rs. 30,456|
|Basic Life Cover + Increasing Income Protection Plan||Rs. 2 crore paid in a lump sum upon death; Rs. 30,000 fixed income paid monthly until the insured is 60 years old or for a term of 10 years, whichever is later; income increase by 10% annually||Rs. 34,488|
Term insurance is one of the wisest choices to make in your present to secure your family’s future for a lifetime. You can look for the best term insurance plan for 2 crore with an insurer of your choice or any term life insurance policy based on your budget and actual financial needs. We hope that the information in this blog would help you make an informed decision; however, do consult your insurance company before making any purchase.
As you can see from the information provided above, the sum assured amount depends on your family’s financial needs. Ideally, the amount you pick should help cover any lost income and cover outstanding debts.
Your term plan tenure should cover you at least until you retire. So, a 30-year old might pick a tenure of 40 years. On the other hand, a 40-year-old might opt for a policy term of 20 years.
No. Once you purchase a policy, the premium amount will stay the same for the entire policy tenure.
Term insurance riders can provide additional financial protection, but they aren’t always necessary. Individuals who work in factories or travel often for work might have more use for an accidental death rider than a stay-at-home mom. You should pick the riders based on your personal needs. Remember, the riders and add-ons you select will affect your term plan premium.
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PayBima is an Indian insurance aggregator on a mission to make insurance simple for people. PayBima is the Digital arm of the already established and trusted Mahindra Insurance Brokers Ltd., a reputed name in the insurance broking industry with 17 years of experience. PayBima promises you the easy-to-access online platform to buy insurance policies, and also extend their unrelented assistance with all your policy related queries and services.
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