Term Insurance – Identify Your Rights And Duties


Term Insurance is the best form of life insurance that offers a total financial coverage for a defined period of time. In any emergency or unforeseen situation the policy perfectly take care of the financial stability of the insured family. In term insurance policy a death benefit is payable to the beneficiary who is generally a family member. By purchasing a life insurance policy one can secure the family future and help them to live a stress free life. The term life insurance plans offer many benefits to the insured.

Secure the Family Future
Secure the Family Future

1. In event of sudden death the nominee of the policy holder gets the lump-sum amount.
2. The plan take care of all the loans and liability.
3. A sum assured amount of money is provided so that family of the policy holder continues to live a stable life.
4. In case of critical illness and disability the term insurance policy take care of the policy holder.
5. The plan also provide supplementary income in case the insured have faced a major loss of finance due to accident disability or illness.
6. If the insured is diagnosed with critical illness the policy provide a lump-sum amount.
7. An additional sum assured is given to the beneficiary in case of the accidental death.
8. Under section 80C of income tax act, section 10D and section 80D the term life insurance plan comes with an excellent tax benefit options.
9. Along with the survival benefit, death benefits and maturity benefit the plan also provide additional rider benefit to the insured. These add-on riders can be added to the term plan by paying the additional premium amount.

Life Insurance
Life Insurance

Although buying a term insurance is a must thing to do. In today’s time as there are plethora of options for the term insurance finding the most suitable one according to your affordability can be a difficult task. While purchasing a life insurance plans one should know well the duties and responsibility of as an insured. Here we have mentioned some rights and duties that a policyholder needs to fulfill while zeroing in on a specific policy.

1. If the term and conditions of the policy are not same as promised at the time of sale the policy holder can cancel the policy or return it within the pre-determined time i.e. generally 15 days from the time of receipt. On cancellation of the policy the insured will get the refund of premium paid after deduction of cost sustained by the insurer like stamp, duty, medical etc.

2. The nominee of the policy has the right to claim the sum assured amount of death benefit in case of uncertain death of the policyholder.

3. Based on the insurance company and the type of policy the insured have the right to modify or alter the policy terms like mode of payment, sum assured, tenure, etc.

4. In case of ULIP some additional rights are also offered to the insured:

• As per the term of the policy the insured can make partial withdrawal of funds.
• On the basis of varying objectives and market dynamics the policyholder can switch funds.
• After the completion of lock-in period the insured can also surrender the policy.

Insurance Policy
Insurance Policy

Duties of Policy Holder

Duties prior Purchasing a Policy Duties after purchasing the policy Duties for Maintaining the Policy
Prior buying any policy a proper research should be done by the insured to determine the need of life insurance and reason behind buying the policy.

Based on the premium paying ability and the needs the policy tenure, premium amount and mode of premium should be selected.

While buying the term insurance an individual should compare the policies offered by different insurance companies online and choose the most suitable plan acceding to your own comfortability.

After the proposal submission, fulfill with any pending formalities or documentation if asked by the insurance company.

The policy bound should be received by the policy holder within 15 days from the proposal acceptance. In case if you fail to receive the policy bound immediately contact the insurer and take up the matter in writing.

After the purchase of the policy the insured must check the documents in term of risk cover, benefits, nominee, tenure and other conditions.

Recheck the details in the policy to match the explanation provided to you at the time of sale.

In order to maintain the policy one should pay the premium regularly within the grace period. The insured can opt for automatic mode of premium payment like ECS or one can get the renewal message so that the insured be particular about due date.

In case of any change in personal details bank details and address contact the insurance company for the same.

By filling the “change of nominee form” one can change the nominee anytime and can get it registered in the record of the insurance company. In case if the nominee is minor then select an appointee by getting his/her sigh on the acknowledgement endorsed as appointee.

The details filled in the application form should be filled very carefully. The insured should know the importance of application as all the further procedure of the policy will be carried based on the information given on the application form. In case if the term and condition of the policy does not match the details in the policy, immediately call the insurance company for clarification and conformation. It is the responsibility of the policy holder to inform the insurer if there is any deterioration or change in the health of the insured.
It is crucial to provide the right nominee details in the form. Get a duplicate document by informing the insurance company in case if you loss the original documents.
At the time of claim follow all the steps and co-operate with the insurance company.