Term Plan that Fits Your Needs

By Abdul Kadir

Choosing the right term plan is one of the most important decisions you can make for your family’s financial security. With a range of options available today, it’s essential to select a plan that matches your life stage, responsibilities, and future goals. A well-suited term insurance plan offers affordable coverage and peace of mind by ensuring your loved ones are protected in your absence. Beyond just life insurance, policies today offer additional term insurance benefits, including critical illness riders, flexible payout options, and extended coverage durations. Here's a practical guide, with examples, to help you find the term plan that truly fits your needs.

1. Understand Your Life Stage and Responsibilities

Your current stage of life and responsibilities should guide your term plan choice:

●     Young professional: You may need basic cover to start with, ideally enough to clear student debts, support rent, or begin saving.

●     New parent or homeowner: You’ll likely want a higher sum assured and supplementary options like child education or loan protection riders.

●     Established family or nearing retirement: A plan that protects dependents through your working years, possibly with a decreasing cover to match your mortgage reduction.

Example:

At 28, Riya chose a term plan with a Rs. 1 crore sum assured to cover her rent and support her family. Her friend Vikram, at the same age, opted for a Rs. 50 lakh cover, which is enough for his student loan, but affordable on his modest salary.

2. Decide on Sum Assured and Term Duration

The sum assured should match your financial liabilities and future plans. Consider:

●     Income replacement (typically 10–15× your annual income)

●     Property and loan responsibilities

●     Future costs like children's education or weddings

The term duration should at least match these obligations and ideally cover your working years.

Example:
Samir, a 35-year-old with a 20-year mortgage, opted for a 25-year term plan with Rs. 1.5 crore coverage. This second cushion allowed for inflation and protected his family if anything happened before he could repay the loan.

3. Explore Additional Benefits and Riders

While a basic term plan provides life cover, most modern plans include useful term insurance benefits that can increase their value:

●     Critical Illness Rider: Offers a lump-sum payment if diagnosed with a major illness like cancer.

●     Accidental Death or Disability Rider: Extra protection if death or injury is accident-related.

●     Return of Premium Rider: Refunds your paid premiums if you survive the term.

●     Waiver of Premium Rider: Continues your policy premiums if you’re disabled or critically ill.

Example:
Anita, 42, added a critical illness rider to her plan. When she was later diagnosed with early-stage heart disease, the rider payout of Rs. 50 lakh paid hospital bills and ensured her mortgage remained protected.

4. Opt for Flexibility in Premium Payments

Term plans today allow for flexible premium payment terms:

●     Monthly, quarterly, half-yearly, or annual payments to suit your cash flow

●     Single premium plans for large lump-sum affordability

Example:
 When Sami took a promotion with higher pay, he switched to annual premium mode and saved on transaction costs. Six months later, he chose the skip option when he had extra expenses, without losing his cover.

5. Choose Your Payout Format

How your beneficiaries receive the payout is essential:

●     Lump sum: Immediate access to full funds

●     Staggered payout: A mix of upfront and periodic payments, great for ongoing expenses

●     Monthly pension benefit: Supports dependents over time, especially useful for ongoing cost coverage

6. Consider Added Value Features

Several insurers like Aviva India now include wellness-linked incentives or digital aids such as:

●     Wellness programmes: Devices like smart watches or BP monitors encourage healthy living

●     Health check-ups and tele-consults: Included in select plans

●     Digital onboarding and claims: Video KYC and online claim settlement enhance convenience

Example:
In one popular term plan, policyholders receive a fitness tracker which helps them stay active, encouraging wellness and reducing long-term health risks.

Also Read: https://www.newsgram.com/economy/2025/03/21/do-medical-tests-affect-your-chances-of-getting-term-insurance

Even premium plans, such as the Signature 3D series by Aviva India, include wellness features while offering options like return-of-premium or critical illness cover, combining standard protection with modern benefits.

7. Compare Providers and Claim Settlement Records

Price isn’t everything. Look at:

●     Claim Settlement Ratio (CSR): Measures how many claims an insurer settles annually.

●     Customer service standards: Quick, courteous support matters in stressful times.

●     Online reviews: Seek genuine customer experiences.

8. Review and Adjust as Life Changes

A good term plan adapts. Consider reviewing every few years, especially after major milestones like marriage, home purchase, or career change.

Example:
Priya took a Rs. 50 lakh cover at 25. At 32, after marrying and welcoming two children, she upgraded to a Rs. 2 crore cover with added critical illness protection, ensuring adequate support for her growing family.

Conclusion

Life is unpredictable, but your preparation doesn’t have to be. A term plan is more than a policy; it’s a promise of financial safety for your family. With so many customisable features and significant term insurance benefits, there's no reason to delay.

Choose a term plan that fits your needs, offers flexibility, protects your family’s dreams, and saves on taxes. It’s a small step today for a lifetime of security tomorrow.

Because your family deserves nothing less. [NG-FA]