Questions You Must Ask Before Buying Term Insurance

The importance of having term insurance is not hidden from anyone. But when it comes to buying a reliable term insurance policy, there are several questions that pop up in the minds of potential buyers that not many have the answers to. This article contains answers to most of those questions. Read further. 

1. How much cover should I opt for under a term insurance policy?

Ideally, the cover for your term insurance policy should be at least 10 times of your yearly income. For example, if a person is earning Rs. 5 lakh per year then he/she must buy a term insurance policy of around Rs. 50 Lakh for adequate support to loved ones in the misfortunate event of his/her death. So, any plan offering cover for around 10 times of your annual income can be considered as an ideal choice. 

2. Can I avail any tax benefits on the premium paid for a term insurance policy? 

Yes. On the premium paid for term insurance plans, you can avail tax benefits of up to Rs. 1.5 Lakh from your taxable income. Apart from this, you will also be exempted from paying tax on the proceeds received under the plan in the misfortune event of death of the policyholder, under Section 10(10D) under Income Tax Act, 1961.  

3. I am an NRI. Can I buy term insurance in India?

Yes. You are eligible to buy a term insurance policy in India if you are a Non-Resident Indian. When visiting India, if you apply for a term plan, then when the underwriting is completed, it will be considered as any other policy owned by an Indian. Note that you may also apply for a term insurance policy from your home country, by getting in touch with the life insurance company in India. These plans are verified by a local notary which is equivalent to an India diplomat or an Indian Embassy official.

4. Can I buy term insurance from 2 different companies?

Yes. You can purchase term insurance plans from two different companies. In this case, both the insurer’s from which you have bought the policy are liable to claim to the nominee in the misDisclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.             fortune event of the death of the policyholder. Many people buy more than one term insurance plans for enhanced coverage.

5. Will I face any issue at the time of claim if I bought a term insurance plan online? 

No. You will not face any issue on purchasing term insurance plan online. Every insurer has a centralised customer service team that answers to all the customer queries or complaints. It does not happen that they differentiate between customers who have purchased the policy online or offline. 

The answers to these frequently asked questions will help you decide which term plan you should buy. In case your query has not yet been solved in the article, then you can get in touch with the customer care executives at InsuranceDekho. They will not only solve your queries, but also help you buy the most suitable term insurance policy as per your budget and requirements. 

Also read :-

10 Questions About Term Insurance Answered

Term Insurance Plans For All Age Groups

Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.