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Term Insurance

3 Most Important Things to Consider When Buying a Term Insurance Plan  

People are always grappling with what is the best sum assured figure for their term plans. In this piece, you will see how it is a question of simple mathematics if you know what to calculate.

Here are the three most important things to consider when buying a term insurance plan:

  • Is it covering your immediate loans and liabilities?
  • Is it covering your children’s primary and higher education?
  • Is it covering your household expenses like monthly bill of groceries, maid servants, driver, petrol, and so on?

Your term plan’s sum assured needs to cover the mentioned expenses. If it is doing so, you can relax – you are adequately covered. It’s really that simple!

In case you are wondering how to calculate primary and higher education expenses, look no further:

  • Calculate your children’s current annual tuition fees and multiply it by 6, 8, 10, or any number depending on which standard they are in currently.
  • For higher education, note the current fees of the course and multiply it by around 2.5 for every 10-year period. For example, if MBA costs 15 lakhs now, it is going to cost around 40 lakhs in 10 years’ time. This is the inflation-adjusted figure.

Beyond this, if there are further queries, our team of insurance experts, who eat, drink, and breathe insurance are at your service at or 86559-86559. Feel free to reach out to us.


Insurance companies have noted that term plans are highly popular among urban Indians and have done their best to give policyholders the advantages of riders and add-ons that can be opted for along with the primary term plan in exchange for marginally higher premiums (never more than 30% of the base policy's premium). Some of the more popular riders include:

  1. Accidental Death Rider – With accidents claiming so many lives across the globe, it only makes sense to avail accidental death rider. This rider pays an additional benefit over and beyond the policy's death benefit to your beneficiaries if you meet an untimely death in an accident.
  2. Critical Illness Rider – A critical illness rider pays out a lump sum benefit to the life insured when s/he is diagnosed with a serious health condition. You can use the payout to meet the hospital bills and keep your household running. Carefully go through the type of illnesses covered under this rider since they tend to vary from one insurance company to another. Cancer, renal failure, and the first heart attack are examples of the critical illnesses that are covered.
  3. Waiver of Premium – The waiver of premium rider helps keep your policy active even when you're unable to make future premium payments because of loss of income due to disability or critical illness. In simpler words, your premiums get waived if you experience disability. It must be noted that there is a waiting period with this rider. 
  4. Disability Income Rider – With the disability income rider, you stand to receive a regular income from the insurance company should you become completely disabled and cannot work. Insurance companies generally pay out a monthly income at the rate of 1% of the full value of the policy.


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