Term Assurance Plans

While discussing the conventional insurance products I told you that Plans under this heading will be discussed in detail later. Almost all life insurance companies offer term assurance products with different features. The essence of term assurance is that it covers risk during the term of the policy. That means in case of survival to the end of the term the life assured or policyholder does not receive any maturity benefit. The features that are added to this basic benefit by various companies enable product differentiation and more demand for the product. Some companies allow addition of rider benefits on payment of additional premium to term assurance products. Some others provide for a refund of premium on maturity. Some others make term an attraction. To cite an example the Life Insurance Corporation’s (of India) Table 43 is a temporary term assurance Plan. The Plan is available for a maximum period of two years and for a minimum period of six months. Premium is very low and risk cover is quite high. Generally term assurance Plans are without profit Plans. No surrender value or loan is available under this type of Plans. While comparing term assurance Plans do not take it that premium is the only factor to be compared. Compare the product in its entirety taking all features of the Plan.

Key words:

Conventional insurance products

Term assurance

Features of Plans

Comparing the Plans