Term plans are popular because they are a pure insurance plan, give adequate insurance coverage and are priced much lower than the other life insurance plans. In the term insurance plan the nominees get the sum assured after the policyholder dies and within the tenure of the plan. If the policyholder dies after the term plan tenure ends then no payout is made.
The term insurance plan helps to protect the policyholder’s family financially.
The term plan offers pure life cover and there are no savings or any money multiplier component attached to it.
The Benefits Of Buying A Term Insurance Plan
There is no profit or any saving component in the term insurance plan. This is just a basic plan that helps to make life insurance affordable. The term insurance plan lets one opt for a larger sum assured at a much lower premium as compared to the other life insurance plans.
Since the term insurance plan does not have any investment component, thus the premium for it is very low. The entire premium is used just to cover the risk. The plan has no survival or maturity benefits.
How Should You Choose The Best Term Insurance Plan
The following should be considered when choosing a term insurance plan.
- Reputation of the insurance company
- Cover needed
- Claim settlement ratio of the policy
- The premium and the coverage benefit of the policy
- Make sure to compare the terms and conditions of the policy
- You can buy the term plan online or offline
It is important to know that the premium of the term insurance plan could be different from one company to the other. It is also dependent on the policy tenure.
SBI Term Insurance Plans
The various SBI life Insurance term plan are:
- SBI life Smart Shield –This is a unique plan that offers four coverage options
- SBI life Saral Shield- This plan offers three death benefits that the policyholder can choose from
- SBI life E-Shield- This is an online term insurance policy which can be purchased only online
- SBI life Grameen Bima- This is a micro insurance plan
Why Did SBI Life Term Plan Lower Its Premium Rate
SBI life term plan reduced the premium rates for its term plans. This is dependent on the age of the person who is insured as well as the tenure of the policy.
The SBI life company keeps reviewing the premiums in 4-5 years based on what the mortality rates are. The health status of the target group has improved because of better medical policies. This lets the SBI life term plan reduce its premium.
The company is also planning to expand its business by going digital. This will give them better exposure and also more customers. Going digital means that the acquisition cost would be lowered and will also let them save on distribution and sales.
Reducing premium will let SBI life term plan stand in the competition as well as expand its profitability in the insurance market.
How Does Reducing Premium On SBI Life Term Plan Benefit Customers
Term insurance plans come with lots of advantages and is among the preferred insurance plans that is purchased by the majority. The reduction of premium on SBI term plans will not only make SBI life competitive but also attract policyholders to the term insurance plan.
The policyholder will be able to save on the premium and since the plan is offered by one of the best and well-known companies, the customers would be assured of the reputation of the company from whom they are buying the term insurance plan.
You should buy a SBI life term plan because it is:
- Simple- These plans can be understood easily as compared to the other life insurance plans
- Pricing is competitive – The term insurance plans are easy to compare and this makes them very competitive
- Flexibility – It is easy to stop the term insurance plan. Just stop paying the premium and your plan ceases to exit
- Tax benefit –The premium amount paid towards the term insurance plan is tax free
- Premium is the lowest – The premium that you pay towards the term insurance plan is the lowest as compared to other life insurance policies with similar coverage
What You Should Know Before You Buy A SBI Life Term Plan
You may not be able to meet the insurance needs with age as the premium that you pay for the term plan increase with age. The term insurance plan is also not offered to those who are over 65 years of age. It is not a form of saving or investment. It thus gives no income or does not have a loan option. You cannot create wealth with a term insurance plan. Keep these in mind before you buy a term SBI insurance plan to offer you and your family financial security.