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Here’s How To Save Money With Your Term Plan

By Author: Nirav Patekar
Total Articles: 4

First, buy as young possible:

Buying a term insurance plan young can save you a lot of money in terms of the premium you pay. This is because when you are young, you are generally less prone to disease and even if you do contract any sort of disease, you are fit enough to thwart it before it can become life threatening.

All this makes you less of a risk to the insurance company and so they provide you with a premium rate that’s on the lower side. Waiting till later means you become more susceptible age-related diseases and then the insurance company considers you as a greater risk and hence levies a heavier premium on your term policy.

Second, choose to buy online:

You can buy your term insurance plan the traditional way, by going from pillar to post, checking out different insurance companies and the policies they have to offer. Or you could choose to buy a term policy online, where you can compare premium rates, cover amounts and tenures of different policies right from your home.

This is the convenience online policy shopping affords potential life insurance customers. But the main advantage comes not from the convenience but from pricing factor of online policy purchases. When purchasing a policy offline, you pay multiple costs that you simply omit when purchasing online.

For example, going in for a policy online automatically means the middleman and his costs are skipped. Further, the insurance company saves operational cost and overhead infrastructure expenditures since you didn’t physically visit the branch and these savings are passed on to the customer in the form of term policies at 30 to 50% discounts.

Third, use tax benefits to save big!

Most of us mistake a term plan as just a basic form of insurance whose main purpose is to protect the financial security of one’s family in case of the insured person’s untimely death. But it also helps us save substantial amounts of money through the tax benefits.

All term insurance policies give customers tax deductions under Section 80C of the Income Tax Act, 1961, along with further deductions up to an amount of Rs 1.5 lakhs. What you save as part of your taxable income can then be directed toward paying the insurance policy’s premium.

Not only that, term policy holders are exempted under Section 10(10) D for receiving any amount as part of maturity benefits from their insurance policy.

Looking at these three tips, your decision to pick up a term insurance plan just got a whole lot wiser. So don’t hesitate, go online and choose a plan that suits your needs and purchase it today, remember the longer you wait the less you save!

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