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Term Insurance Calculator

Term insurance calculator is an online tool, which helps a person to determine the approximate premium cost that (s)he has to pay to buy a term insurance policy from an insurer. It's quite a handy tool as it allows you to compare among different plans (offered by the companies) and select the suitable one.

How important is a term insurance premium calculator?

Even today, many people prefer to buy term insurance via agents. However, there is one thing that they don't understand- buying a policy through an agent results in an increased premium amount. This is where the term insurance premium calculator comes into action. It turns the entire process into a hassle-free and time-saving procedure. Let's understand this with an example-

Mrs. Vandana plans to buy term insurance for her family. On her sister's advice, she asks for an agent's help. Unhappy with the discussion, she decides to do her research. She comes to know about the ‘Online Term Insurance Premium Calculator'. In a matter of a few minutes, the calculator generates top-notch term insurance plans (along with the premium rates ) on her screen. She selects the desired plan and manages to save around 10% as compared to the quotations offered by the agent.

What are the benefits of a term insurance premium calculator?

If you require the best term plan, you need the help of a term insurance premium calculator. The following are its benefits to prove its necessity-

Plan comparison

Generally, insurance companies sell multiple term plans to meet the different needs of the customers. Here, the calculator allows you to compare the features, premium, and coverage of all plans so you can make your decision.

Time-saving and hassle-free

As everything is done online, there is no need to submit hard documents. You just enter the information, wait for the quote, and select the best among them.

Cost-effective

Buying term plans online is cheaper than the offline mode, as no intermediary is involved.

How to use a term insurance premium calculator on PolicyX.com?

Generally, the calculator functions in 4 simple steps. Let’s take a look at it.

  1. Look for 'Free Quotes From Top Companies' on the top of this page. Enter your personal details and click on 'Continue'.
  2. Fill-in your income, city and click on 'Proceed'.
  3. Select the sum assured amount, policy tenure and riders (if needed).
  4. Within a few minutes, the calculator will display premium details of different term plans offered by the companies.

Which factors affect the term insurance premium?

Here are a few noteworthy factors, which impact the term insurance premium. Let's check them out.

  • Requirements: Before calculating the term insurance premium, it is important to decide your insurance needs and requirements. Every insurance plan offers different benefits, and it's important to choose a plan according to your future financial goals.
  • Age: Age plays an important role while calculating the term insurance premium. When you are young, you are healthy and less prone to diseases. That's why insurance companies charge a lower premium in return.
  • Gender: If we go by the data of life insurance providers, women live longer than men. Therefore, women are charged a lesser premium as compared to men of the same age.
  • Lifestyle: The lifestyle of an individual is also considered while calculating the term insurance premium. If one has smoking habits or is an alcoholic, (s)he will be more prone to life-threatening diseases and will need to pay high premiums.
  • Policy Term: Policy tenure plays a key role while calculating the term insurance premium. The shorter the duration of the policy, the higher premium you have to pay.
  • Sum Assured: The chosen coverage amount of your term insurance plan is another factor that affects its premium amount. If you choose a high sum assured, you have to shell out a higher premium in return.

Are online term insurance premium calculator estimates reliable?

The term insurance premium calculator indeed eliminates the hassle of lengthy manual calculation and puts an end to human errors and saves a lot of time and energy. To get the correct estimate of your term insurance premium, you need to enter correct personal details, the desired sum assured, and preferred policy term to enable it to generate the premium amount for different term insurance plans.

FAQ’s

1. Do term insurance plans offer tax benefits?

Yes. Term insurance plans offer tax benefits under 80C of the Income Tax Act, 1961.

2. What documents are required to buy an online term insurance plan?

  • Proof of income/employment
  • Proof of age
  • Proof of education
  • Proof of address - residence and correspondence
  • Proof of identity
  • Photograph(s)
  • Others requested by the company

3. How much cover should I take in a term plan?

Choosing your sum assured amount depends on several factors like:

  • Your family's needs
  • The number of dependents you have
  • Your budget
  • The lifestyle you wish to provide to your family

Analyze all the factors and then choose as per your needs & requirements.

4. Does being a smoker increase the premium amount?

Yes. Being a smoker will increase your premium amount, as smokers are at high risk of getting life-threatening diseases.

Last updated on 24-11-2020