What is a Life insurance Policy?

Term Life Insurance is a simple plan, which takes care of the expenses of your family in your absence in the form of a huge life cover for a very small premium. In case of a policyholder's untimely death, their family or nominee receives the Cover Amount as per the policy. The plan can be customized to one's needs by including add-on benefits.

Your cover amount of Term Insurance should be a factor of your family's expenses keeping in mind the inflation as well.

A simple way to calculate is going up to 20x of your annual earnings so as to sufficiently cover your family's financial needs in your absence

Life Insurance policies offer an option of Return of Premium. In case you choose this option, all the premium paid, excluding GST, is paid back as Survival Benefit, in case the policyholder survives the Policy Term

In case of the insured's death, the nominee of the deceased will be able to claim in the following way:

• Intimate the insurer about the death as soon as possible with all the important details such as time, place, and cause of death.
• Submit needful documents and proof to the insurance company. This will consist of the insured's death certificate along with the claim form provided by the insurance company.
• If the policy was assigned, the assignee will have to provide the documents. If someone else (apart from the nominee or assignee) is filing a claim, (s)he has to submit the legal proof of his/her relation with the insured.
• If required, post-mortem, hospital, and attending doctor's reports have to be submitted.
• In cases involving police inquiries, an investigation/survey report will have to be submitted.
• Once the investigation is over, the insurance company will approve/disapprove the claim. The details of the same will be shared with the claimant.

Yes, the premium paid towards the policy is tax exempted up to a maximum limit of Rs 1.5 lakh in a financial year U/S 80C of the Income Tax Act.

Yes. Depending upon the cash value of a particular policy, it can be cashed in. Cash value is a part of a life insurance policy's death benefit which can be liquidated. In case the policyholder takes a loan against the cash value and passes away while the loan is unpaid, the death benefit is reduced by the amount of the outstanding loan.

It completely depends on your insurance needs. However, it is beneficial to have enhanced insurance coverage and opt for life insurance and critical illness cover both.

Yes, life insurance policies do cover accidental death. However, one must check the policy documents if it specifically states that it does not cover death by accident.

Yes. The life insurance policies offer a grace period of 30 days (to pay the premium) in case the policyholder missed his/her premium payment date.

The amount of cover depends on your income, your family's requirements, and your liabilities. However, as per the financial experts, your cover should be at least 10-15 times the annual income.

The IRDA has directed all the insurance providers to allow policyholders to revive their lapsed policy within two years from the time it is deactivated. One needs to pay the renewal fee along with the late fee and additional penalties that may vary from insurer to insurer.

In such scenarios, where both the policyholder and nominee died, then the benefit will be payable to their heirs or legal representative.

In such a case, you can add a new nominee. In case you don't, by default, the company will consider your heir your new nominee.

A term plan is the cheapest type of life insurance since it does not include any survivor benefits. When the policy period ends, the plan lapses.

The thumb rule for choosing the right coverage is getting the cover of 10-15 times your annual income. Therefore, analyze your requirements first, and then decide your ideal life insurance coverage.

If you are looking for a coverage that lasts for a shorter period of time and buys in affordable premiums then you can buy a term insurance policy. Whereas, if you want coverage for a very long time or for your entire life then go for a whole life insurance policy.

Return of Premium is a feature that you can get with your term life insurance wherein, if you outlive your term insurance policy the insurer pays you back the premiums that you paid in full or partially.

If you stop paying for your life insurance policy, your policy will lapse after the grace period and you will lose all the premiums that you have paid.

Your life insurance premiums are based on multiple factors such as your age when you decide to buy the policy, lifestyle habits which include smoking and drinking, medical history for existing diseases, gender and the tenure of your policy.

Since life insurance doesn’t fall into gross income you do not need to report about the amount you receive.

Although all kinds of life insurance serve different purposes, Term Insurance is said to be the best form of life insurance.

Short term life insurance is known as term insurance. Yes, it is an excellent option as it gives you affordable premium payment options and you get the flexibility of switch or extend your coverage.