By Yashvi Jain
Earlier, when you buy an insurance policy, either an agent or the branch will assist you with the premium calculation, depending on your financial needs. But today, with the introduction of the Internet in every phase of our lives, we can quickly check the insurance premium payable online using a term insurance calculator. Every insurance company has its term insurance calculator available on its website or mobile application.
A term insurance calculator is a free online tool that helps calculate the amount of premium payable for the desired insurance coverage and policy benefits. The premium is calculated based on the life insured’s age, type of coverage, amount of coverage, insurance history, and other factors. In a term plan, life coverage is the essential aspect, as this is the amount that your nominee gets in your absence.
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Why Is An Online Term Insurance Calculator So Important?
An online term insurance calculator can make things easy for you. Here is why you must check your premium on a term insurance calculator before buying a plan:
- Comparison of various plans to select the best plan
- Time-saving and easy to check
Let’s dig into each of these aspects in detail.
Comparison of various plans to select the best plan
Insurance companies usually offer different term plans to suit the customer’s needs. When using a term insurance calculator, you can compare the various plan features and premiums to select the best plan for you. You can visit an insurance company website and use the term plan calculator to compare each insurer’s premiums in one place.
Time-saving and easy to check
You don’t have to visit the insurer’s office or talk with your agent to schedule the premium calculation and submit any documents. Comparing the term plans online helps you get quotes within minutes. Hence, it facilitates a quick decision-making process as to whether you need to buy the policy or not.
Once you have compared the different premiums available using a term insurance calculator, you can buy the term plan online at a specific premium amount and coverage. Buying term insurance online is also cheaper as there are no intermediaries or agents involved.
Effective financial planning
Knowing an estimated amount of term life insurance premium makes it easier for you to plan your financial goals effectively.
Term insurance is also one of the best investment options for tax benefits (both deductions and exemptions) under the Income Tax Act 1961. It offers full protection for your family in case of any unforeseen death event of the insured.
How to use a term insurance calculator?
When you use an online term insurance premium calculator, you need to follow a series of steps mentioned below:
- Visit your insurer’s website and input the necessary details. These details include your age, retirement age, annual income, and whether you have any existing life insurance cover.
- The next step is to enter your financial data, which includes details regarding all types of assets and liabilities under your holding. Like for example, if you have invested in mutual funds, or taken any loan.
- Though the online interface of the term insurance premium calculator will be different for each insurer, you will either be called by their representative executives or shown with a list of premium options available.
- Once you know the premium, you can buy the term plan using net banking or mobile banking applications.
Are Online Term Insurance Calculator Estimates Final?
An online term insurance calculator available on the insurer’s website is accurate and updated with the latest quote. Thus, instead of relying on any third-party providers or agents, you should depend on the insurer’s estimates when it comes to buying a term plan. Though the results provided in the term insurance calculator are accurate, the final premium cost can be slightly different from the quote you receive
Tips for Choosing The Best Term Policy
While determining your policy, consider the number of dependent family members and their ages.
- Think about the amount that they will need to maintain the same lifestyle.
- Coverage should be based on your family’s needs and not based on your income.
- Include the outstanding liability (if any).
- Choose the plan that offers a high claim settlement ratio.
- Choose your riders wisely to maximize insurance benefits.
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Among the different investment options, term insurance is also one of the best investment options that provide maximum coverage. To maximize term plan benefits, you can choose additional riders like critical illness coverage, accidental death coverage, or accidental disability. Most insurers charge an additional premium to the policyholder’s existing term plan. So, it is advised that you talk with your insurer before finalizing the policy terms and conditions.
(Disclaimer: The article is sponsored, and hence promotes some commercial links.)