Different Types of Term Insurance Policy Users

Even if you are single, you should consider buying Term Insurance (TI) if you have dependents, such as elderly parents or siblings. For instance, if you have an ageing parent who depends on you for financial support, Term Insurance can help them in case of your untimely death.

It can also be an excellent idea if you have high outstanding debts or work in a high-risk profession. Here’s an example. 

Let's say John is a single commercial pilot. Despite not having a spouse or children, John has significant outstanding debt, including a mortgage, car loan, and student loan. He also supports his elderly parents financially. As a pilot, John works in a high-risk profession and recognises that anything can happen at any time. Therefore, he buys Term Insurance to provide financial security for his parents. He also ensures that his outstanding debts are paid off in case of his untimely death. With TI, John can have peace of mind, knowing his loved ones will not be burdened by his debt. They can continue to receive financial support even after he is gone.

Consider a couple in their 30s who work and have no children yet. They have a joint mortgage, car loan, and credit card debt. In the event of a death, the other person would struggle to pay off these debts on a single income. Term insurance can cover these financial obligations.

Let's consider the life of a married couple, Mr. & Mrs. Sharma, who are in their 30s and living in Mumbai, India. They don't have children yet, but they both work full-time jobs and have a joint mortgage, car loan, and credit card debt. 

In case of either one's untimely death, the surviving spouse may struggle to pay off these debts on a single income. This is especially true if they have no support from their extended family. By purchasing a Term Insurance policy, the surviving spouse can receive a lump sum payment. This can help cover these financial obligations and provide financial security during a difficult time. 
 

A couple in their 40s with young children has a mortgage, car loans, and education expenses. If one of the parents passes away, the death benefit from Term insurance can help cover these expenses and ensure the children's financial security.

Here’s an example: 

Rohit and Priya, in their 40s, live in Delhi. They have two young children, and the couple is the breadwinner of the family. They have a joint mortgage, car loans, and education expenses for their children. If one of them were to pass away unexpectedly, the surviving spouse and children may struggle to pay off these financial obligations. This is especially true if they have no support from their extended family.

To ensure their children's financial security, Rohit and Priya purchased a term insurance policy with a sufficient death benefit. This can help cover these expenses and provide financial stability during a difficult time. They can have peace of mind knowing that their children will be taken care of in case of an unfortunate event.

Let's say a business owner has taken out a business loan to finance their venture. In case of their untimely death, Term insurance death benefits can cover the outstanding business loan. This ensures that the business can continue to operate smoothly. 

Here’s an example: Rahul runs a successful manufacturing business in Mumbai.

He has taken out a substantial business loan to finance his venture, and the loan's outstanding balance is significant. If Rahul were to pass away suddenly, his family and business partners would be responsible for repaying the loan, which could burden them financially. To ensure business continuity and protect his family's financial interests, he purchased a Term insurance policy that covers the outstanding loan amount. If he died, the policy death benefit can be used to pay off the business loan.

This will ensure the business can continue operating smoothly without financial setbacks. This way, Rahul's family and business partners can have peace of mind knowing that the business will be taken care of in case of an unfortunate event.

Retirees may still have outstanding debts or dependents, such as adult children with disabilities or grandchildren. Term insurance can provide financial protection for their loved ones and ensure their debts are paid off in case of death. 

Here’s an example: Suresh and Radha are an elderly couple living in Chennai.

They have adult children, one with a disability, who need ongoing care and support. They also have outstanding debts, such as a mortgage and a car loan. While they have saved enough for retirement, they worry about their adult children's financial security. They are also concerned about the burden of their outstanding debts in case of their untimely demise. To provide financial protection for their loved ones and ensure their debts are paid off, Suresh and Radha purchased a term insurance policy with a death benefit.

This policy can cover their outstanding debts and provide financial support for their adult child. This way, they can have peace of mind knowing their child will be taken care of. In addition, their debts will not burden their family in an unfortunate event.

Most insurers require a minimum age of 18 and a maximum age of 65-70 to purchase Term Insurance.
 

Yes. A retired individual with financial dependants and outstanding loans. 
 

Yes, some insurers allow you to increase or decrease the sum assured during the policy term. However, this may be subject to certain conditions and may lead to changes in your premium amount.
 

In case of death due to natural causes, most Term Insurance policies have a waiting period of 2 to 3 years from the date of policy inception. However, there is usually no waiting period in case of death due to accidental causes.
 

Yes, your premiums are likely to increase as you get older. This is because the risk of death or illness increases with age, and the insurer will adjust your premiums accordingly.
 

Yes, most insurers allow you to cancel your policy during the free-look period (usually 15 to 30 days from the date of policy inception) and receive a refund of the premiums paid. However, if you cancel the policy after the free-look period, you may not be eligible for a refund.
 

Some insurers offer Term Insurance policies for shorter durations, such as 5 or 10 years, in addition to the standard policy term of 20 to 30 years. However, the premium amount may be higher for shorter policy terms.