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27 Oct 2021, Edition - 2297, Wednesday

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Business

Know-How to Evaluate Your Insurance Needs With a Term Plan Calculator

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Life is unpredictable and full of surprises. Therefore, it is important to secure your future with insurance plans that can provide you with a safety net if something happens to you. However, with so many types of life insurance available for you to choose from, it can often get confusing how to choose the right one.

But don’t worry. Tools like a term plan calculator can help you choose the best policy suited for your needs and budget. Many financial experts advise prospective policy buyers to use a term insurance calculator online to gain an understanding of the available options.

Here are some benefits of using a term plan calculator.

– Enables You Choose The Right Policy

Term insurance calculator helps you by calculating the exact coverage that you are going to need and the premium that you will have to pay. Besides, it also helps you choose an adequate cover, it also allows you to calculate the appropriate duration of the policy.

– Helps You Compare Plans

When you are buying a term plan, it is always a good idea to compare several policies before making the investment. A term plan calculator can do that for you with ease. It helps you see the policy benefits, its features, and premium rates to help you choose the right insurance cover that is suitable for you and your requirements.

– Saves You Money

When you use a term plan calculator, it saves you money by helping you choose the best deal.

– Quick And Accurate Results

The term plan calculator can give you quick and accurate results that can be used to make a sound investment decision. No matter what types of life insurance you want to explore, such calculators can help.

Term insurance is a pure insurance plan that gives you comprehensive coverage at affordable premiums. It also provides you full protection as well as financial stability to your loved ones, in case of your untimely demise.

Factors Influencing Your Premium

When you are buying a life insurance policy, you have to answer a series of questions about your health, lifestyle, professional background, etc., to help the insurer decide your riskiness. Every insurance company has their own set of guidelines for issuing term insurance. However, there are certain common factors that can influence your premium amount. Some of them are listed below:

1. Age

This is one of the most important factors in deciding the premium of your policy. The reason is that an insurance provider sees a young person as relatively low-risk and someone less likely to die of life-threatening diseases.

Additionally, a young investor is also likely to choose a longer duration for the policy. Therefore, the premium amount for them is low as compared to an older person.

2. Gender

According to insurance providers, women tend to live longer than men and have a lower possibility of raising a claim. Hence the premiums for women is comparatively less than it is for men.

3. Lifestyle Habits

Smokers and drinkers pay at least 40-60% higher premium than non-smokers and non-drinkers.

4. Policy Duration

The policy term plays a crucial role in defining your premium. Longer policy duration automatically transforms to lower premiums.

5. Mode Of Buying The Policy

Premiums also depend on where you are buying the policy. Your premium will be lower if you buy your policies online as the company is able to save on administrative costs that they are happy to pass on to their customers as discounts.

6. Payment Frequency

Someone choosing to pay monthly premiums may have a higher premium compared to those who pay them annually. This happens because monthly payments may include added cost for the insurance provider regarding the collection and processing of your payment.

7. Health Status

When you are buying a term policy, you would be required to enter your medical information for the term plan calculator to calculate your premium accurately. You will also have to undergo medical tests to assess your current health status.

Based on these tests and medical information, your insurance provider will calculate the premium. So, if you are considered as medically fit and healthy, it will help you in lowering the premium.

8. Obesity

Obese people tend to pay more premium because of their possibility of contracting lifestyle diseases, such as diabetes, blood pressure, etc. Since their risk of contracting a life-threatening disease is high, the premium will also be higher.

9. Professional Background

Certain occupations are considered to be more dangerous than the others, such as fishermen, mineworkers, shipping, etc. Therefore, these people tend to pay more premium than someone who is working in a relatively safe environment behind a desk.

All these factors together play a huge role in determining the insurance premium. This is why you must use a term plan calculator to see which insurance provider is offering you the best deal for the least price. Most of the reliable insurance providers in the country offer these tools to help you calculate the premium in real-time and make an informed investment decision.

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