Term insurance is very common these days. Few years ago, when insurers were not aware with this kind of insurance schemes, they used to prefers other form of insurance in which there was a maturity benefit. But today, people are much aware and they better know value of their lives. So, many insurers are going towards term insurance. It is a life insurance which gives protection to your life for a specific period of time. You can select the policy term while taking a term insurance.
As term insurance is a pure life insurance, it does not provide any maturity benefit. This insurance gives complete risk cover to your life and provides you benefit only if you die during the insurance period. If you survive till your insurance term gets over, you will not get anything on maturity. In case, anything mis-happen occurs to you in which you die, the policy amount (risk cover) is paid to your nominee and the policy is closed.
Your policy get lapsed if you have not paid the policy premium even after the grace period. Once, your policy is lapsed, you will not get any benefit mentioned in the policy document. However, insurance companies provide you a grace period of 30 days even after premium due date. During this period, if you pay the premium, your policy remains inforced. Apart from this grace period, companies also provides you a free look period of 15-20 days after issuing a policy. During this period, if you found that policy is not matching your requirement, you can send a request to cancel the policy. After deducting a nominal charge, remaining amount is credited to your account.
A term insurance can be taken for a term of 10 to 35 years or upto a maximum of 70 years of age at policy maturity. As term insurance is a pure death benefit insurance scheme, it primarily provide financial support to your nominee. Term insurance is preferred over other insurance schemes as it is less expensive as compared to other insurance. Premium frequency can be yearly or half yearly in a term insurance. The term you select while taking a policy, your premium remains same throughout that policy term.