Term insurance plans provide coverage for a specific term and in the event of an unfortunate death during this term, the insurance company offers your family/beneficiary a death benefit as specified under the policy.
Prior to buying a term plan, it would be wise to compare premium rates with the help of a term insurance calculator. Actually, the Term Insurance calculator is a specialized tool that helps you analyze, compare and plan your insurance coverage. It enables you to know the exact amount of premium, you need to pay for buying the best term insurance plan. You only need to submit specific data to calculate the premium such as the proposer’s name, age, gender, sum assured, policy term, smoker/non-smoker details, etc.
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Steps to Compare Rates with Term Insurance Calculator
Term Insurance Calculator requires you to provide some basic details to compute the cost of purchasing a term plan online.
Step 1: Enter the key details like Gender, Date of Birth, Sum Assured, Policy Term, and Tobacco details by choosing the appropriate option.
Step 2: Submit your Name, Email ID, Mobile Number, and City. After entering these details, you will receive a one-time password (OTP) on the mobile number you specified. You need to enter that OTP to proceed further.
Step 3: Here, you need to mention whether you want your family to receive the policy proceeds as a lump sum, Level/Increasing monthly income, or Return of the premium amount at maturity.
Step 4: After following all the above three steps, the Term Insurance Calculator displays the wide range of term plans along with the premium amount, depending on the details provided by you. You only need to compare and choose the best term plan that ensures adequate coverage for your family.
Parameters on which Calculator Works
Term Insurance Calculator calculates premiums on the basis of the following parameters.
- Sum Assured: Sum Assured provides financial cover for your family, as the company pays the sum assured amount to the family in case of your demise during the policy term. While you are providing the desired sum assured amount in a premium calculator, it is advisable to first compute your monthly expenses plus current liabilities and other liabilities that you foresee in the near future. Also, don’t forget to add the inflation factor while considering the adequate sum assured amount to cover your family’s expenses. Upon choosing the high sum assured, you need to pay a proportionately higher premium to provide a high cover. It is recommended to pick a sum assured that can easily fulfill your family’s expenses when you are not around.
- Age: Age is one of the key factors required in calculating premiums by the calculator. Insurance companies charge a higher premium for insuring you at a higher age, as the risk of mortality increases with increasing age. Thus, it would be the right move to purchase a term insurance policy at an early age, so you can get the life cover at low premiums.
- Gender: Term Insurance Calculator also considers gender while computing the premium amount for a term insurance policy. Premiums charged are different for male and female policyholders. According to statistics, females have higher longevity than males and insurers, thus having less risk in insuring females, that’s why females enjoy the premium rebate for buying a term plan.
- Policy Term: Policy Term is the duration during which you are covered under a term insurance plan. These plans are available with the option for premium payment through the entire policy term, limited premium payment, or single premium payment term. With the higher policy term, the insurance company charges you a higher premium amount. It is advisable to choose the premium payment term wisely, so you can ensure your family’s financial security.
- Tobacco Consumption Details: The Term Insurance calculator also asks for tobacco-related details, while you are seeking a premium amount for your term plan. Tobacco consumption poses a higher threat to life and that’s the reason, premium charges are also higher for a person consuming tobacco.
Benefits of Using a Term Insurance Calculator
Using the Term Insurance Calculator is quite convenient, as the user only needs to provide some key details to get the best results and a layman can also use this calculator for buying the best term plan. The user also has the flexibility to put multiple patterns of inputs to get the different sets of results as per the requirement and budget. Term Insurance Calculator is a cost-effective tool that displays the different sets of term plans and you can easily choose to buy the best term plan at a zero cost. You can also use filters such as Claim settlement Ratio, Payout types, and preferred Insurance companies to get more precise results.
By using Term Insurance Calculator, you can easily get to know the exact premium amount for different term insurance plans. By knowing the cost and coverage associated with a term plan, it would be easy for you to choose and buy the best term plan.