A Term Insurance policy's main goal is to provide financial security to your family in the event of your death. If you don't renew your policy when it matures, your family will lose the protection you've been paying for, all this time. The aim of Term Insurance is effectively defeated by Non-Renewal of the policy.
Renewal does not require a medical exam which means that your medical history will have no bearing on the policy's renewal. When a policy has to be renewed, the Insurance Provider renews it without any additional conditions.
Renewing the Term Insurance Policy is a must for every individual. However, if you do not pay your premiums timely, your Insurance policy will lapse, leaving your family with no financial security in your absence. Renewal of Term Insurance plan provides an opportunity for the policyholder to extend the coverage as per your requirements and age.
Following are the reasons why Term Insurance Renewal is important:
Term insurance offers Tax Exemption of up to 150,000 INR under section 80C of the Income Tax Act. Additionally, add-on covers such as critical illness cover provide Tax Exemption up to 25,000 INR under section 80D of the Income Tax Act. Renewing your Health Insurance on time ensures that you can continue to avail of Tax Benefits.
The premium remains the same when you renew your policy on time. Not renewing your Term plan on time leads to a hike in the premium amount due to an increase in age, changes in medical history, etc.
Medical Test and KYC
If you renew your policy, then you don't have to submit the KYC documents again. Also, there would be no need to undergo a medical examination all over again.
Defeats the Main Purpose of Insurance
The biggest drawback of not renewing the policy is that the policy coverage will lapse. If you do not renew your policy on time, then the beneficiary will not get any stipulated benefits of the policy.
Discontinuation of Term Plan Benefits
If you don't pay the premium on time, your family will not get any Death or additional Rider Benefits and all the previous paid premiums will become meaningless.
No Tax Benefits
If you do not renew your Term Insurance policy, you will not get any Tax Benefits under the Income Tax Act. Premiums of term plan are eligible to provide tax exemption of up to 150,000 INR under section 80C of Income Tax Act, 1961.
If you do not renew your policy on time and your policy lapses, it may not be possible for you to file a claim and the beneficiary will not get any sum assured in case of any mishap. Not renewing the policy defeats the entire purpose of buying Term Insurance.
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When a person forgets/fails to pay the premium, the policy lapses. Normally, every policy has a grace period that varies from 15 to 30 days. However, if the premium is not paid within the grace period also, then the policy lapses automatically.
Whether to renew a lapsed Term Policy or get a new one depends on the circumstances & your needs at the moment. However, you should not make your decision just on the basis of the premium amount; instead, you must choose a policy that meets your current requirements.
The below-mentioned table represents few differences between reviving a lapsed policy and buying a new policy, which shall help you make a calculated decision.
|Revived Policy||Buying new policy|
|1. You will get cumulative benefits like No waiting period, etc.||1. You have to start from the scratch, & you would not be able to avail of the Cumulative Benefits.|
|2. Medical Examination is not required.||2. Medical Examination is mandatory.|
|3. You will get the benefit of full tenure of the Term Plan.||3. You will lose the benefits of full tenure of the Term Plan.|
You can renew your policy from the official website of the company or through PolicyX.com.
I. Through Company's Official Website
II. Via PolicyX.com
It is important to Renew your Term Insurance without any interruption. Insurers remind customers about the renewal dates of Term insurance online as well as offline. The policyholder should stay up to date on renewal dates and make payments on time. Through the company's official website, you can make the payments easily & in a hassle-free manner.
You must renew your Insurance Policy on time to get the maximum benefits and for the continued safety of your loved ones.
1. What are Renewal Premiums?
Renewal Premiums are the premiums that are paid by the policyholder to the Insurance Company in order to keep the plan operational.
2. What if you do not succumb to death within the policy tenure?
If the policy tenure gets over & the policyholder does not succumb to death during the time period, the Insurance Plan will come to an end at the end. If there are any Survival Benefits, they are made available to the policyholder. You can also renew the policy to continue Life Insurance protection, depending on the Terms & Conditions of the insurance company.
3. Why is Term Insurance important?
A term plan is important for the following reasons:
4. Can the premiums change after a period of time?
It depends on various factors like the declaration of habits like smoking, drinking, or addition of riders, etc.
See More Term Insurance Articles
See More Term Insurance Articles
December 14, 2022
PolicyX has a smooth service from booking policy to verification. Employees are very patient and have good knowledge and help you throughout the process. Had great experience dealing with them
December 9, 2022
I had many confusions regarding the term policies . But Policyx has handled it well, m happy that they are my wayfarer in this journey.
July 11, 2022
Good company. Presents nice term insurance plans and flexible plans also. My husband has brought one for the family.
July 11, 2022
IndiaFirst Term Insurance company ensures that your family s needs are looked after. One of the best companies offers a term plan per your needs.
July 6, 2022
I recently received the claim amount of the policy that my husband had brought for us. I am glad that the company understands the needs of its customers and their families. Well done Canara HSB...
July 6, 2022
I bought a term plan with Canara HSBC for the protection of my family and have been satisfied with the benefits received. It is simple and easy to buy their plans.
July 6, 2022
I am very happy with the term plans offered by the Canara HSBC Life Insurance company. The plans offer comprehensive coverage and I am sure will support my family after my demise.
June 9, 2022
Bharti AXA is a good life insurance company, and I am sure if something ha[opens to me, the company will look after my family s needs.
Naval Goel is the CEO & founder of PolicyX.com. Naval has an expertise in the insurance sector and has professional experience of more than a decade in the Industry and has worked in companies like AIG, New York doing valuation of insurance subsidiaries. He is also an Associate Member of the Indian Institute of Insurance, Pune. He has been authorized by IRDAI to act as a Principal Officer of PolicyX.com Insurance Web Aggregator.