Who doesn’t like the sale season? After all, the discounts and offers make you go bizarre! We all like to save money and look for ways to lower our expenses. What if I tell you that you can lower your term insurance premium too?

Term insurance is an insurance plan, which allows you to opt for a higher sum assured level at a very low premium. Even though the premiums of a term insurance plan are already low, there are ways you can reduce them further. Want to know how? Read on to know how! Buy a term plan at a younger age

A term insurance plan covers your risk of death. This risk increases as you age. That is why the premiums of a term insurance plan are dependent on your age. Here is how premiums differ across ages:

If individuals aged 30, 40 and 50 years buy Aegon Life’s iTerm Plan with a Sum Assured of Rs.50 lakhs and a term of 30 years, here is what the premiums would be:

If you buy an insurance plan at a younger age, your premium rate would be low. If you delay, the premium too would increase with your age. For instance, if you are aged 30 years and opt for a cover of Rs.50 lakhs, you might be charged only Rs.10, 000. But if you are 35 years, you might be charged Rs.11, 000 for the same Rs.50 lakhs coverage. So, if you are delay to buy a term insurance plan, don’t. Buy it at the earliest to enjoy lower premiums.

  • Choose to pay the premiums annually

Every term insurance plan offers four types of premium payment modes. You can pay the premium annually, half-yearly, quarterly or monthly. Annual premiums are the lowest. If you choose monthly or quarterly mode, your premiums might be higher as the administrative costs of the company increases. So, choose the annual mode of premium payment and lower your premiums. .

  • Go for a longer tenure

The premiums of a term insurance plan are also dependent on the term of the plan you choose. If you choose a policy with a higher term, the premium would be lower and vice versa.

  • Stay healthy

Your health has a direct effect on your death risk and, as such, influences your premium rates. If you are obese, suffering from medical ailments or have genetic disorders, your premiums would be high. While you cannot control genetic disorders, you can make an effort to maintain your weight and try to avoid other health related ailments. Staying healthy pays, literally, as you enjoy lower premiums.

  • Avoid smoking and alcohol

Smokers present a higher health risk and increase the chances of premature death. As such, insurance companies charge higher premiums from smokers. Similarly, alcoholics also have higher risk of death and are charged higher premiums. So, avoid smoking and drinking and you can reduce your term insurance premium.

  • Do not opt for unnecessary riders

Riders are additional policy clauses which increase the scope of coverage extended by a term insurance plan. Some popular riders include:

  • Accidental Death and Disability Rider – this rider pays an additional Sum Assured if you face accidental death or disability.
  • Critical or Terminal Illness Rider – under this rider, there are specifically covered illnesses. If you are diagnosed with any of the covered illness during the tenure of the policy, the rider pays you an additional Sum Assured.
  • Premium Waiver Rider – this rider waives off your future premiums if you face total and permanent disability due to an accident.

While riders are very useful in increasing your term insurance plan’s coverage level, you should avoid unnecessary riders. For instance, if your term plan already has an inbuilt accidental benefit rider, buying a separate rider for the same doesn’t make sense.

  • Compare before you buy

There are innumerable term insurance plans available in the market, each offering great features and benefits. Every plan has a different rate of premium based on the coverage it offers and also on the insurance company’s pricing policies.

Before you shortlist a term insurance plan, compare between the different available plans before choosing one. Compare every plan’s coverage features vis-à-vis the premium charged. Then choose the plan offering you the maximum coverage at the lowest price. Thus, by comparing before buying, you can save on term insurance premiums.

A term insurance plan is the cheapest life insurance plan available in the market. Against a considerable sum assured level the premiums are minimal. Despite this, there are ways to lower the premiums further. If you remember the above-mentioned tips you can reduce your term insurance premium further. So, what are you waiting for? Utilize these tips right away and enjoy lower premiums!

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