Life is uncertain and challenging circumstances can occur at any time. Having a term plan in your financial portfolio can help you cover financial risks in case something happens to you. A term insurance plan is a pure life insurance product that offers wide coverage at a low price. It is a contract between the insurer and the individual where the insurance provider promises to pay a certain sum of money, also known as sum assured, to the beneficiary upon policyholder’s demise.
Long gone are the days when you had to rely on an insurance agent to buy a policy. Thankfully, online tools like term plan calculator can help you choose the right policy and assess the exact sum your family will need to avoid any financial crisis in your absence. In exchange for this protection, the policyholder is required to pay sum of money regularly, known as premium, to keep the policy active and avail its benefits when the time comes.
However, this premium amount is affected by a number of factors and that is why you need a term insurance premium calculator to know how much you will have to pay to buy a policy of a certain amount.
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Let us talk about that in detail.
What is a term insurance calculator?
As has been discussed above, a term plan calculator is a financial tool that is available to use for free. It can calculate the estimated sum assured you would need in order to pay for your lifestyle, long-term goals, and liabilities.
The calculator also gives you an estimate of premiums as you enter all your details. But most importantly, term insurance calculators are easily found online and free to use. It is designed in such a way that it simplifies the process of choosing a term insurance plan amid plethora of options.
It can perform all the complex calculations for you within minutes and also give you information in an objective format that allows you to make better investment decisions. Additionally, a term plan calculator also allows you choose various parameters, such as premium payment options, sum assured, and rider benefits, to customize your term insurance.
However, despite its many benefits, there are people who wonder why buy term insurance online when you can do it with an insurance agent. The answer is the autonomy you get in the decision making process as well as the transparency that helps you in making a well-rounded investment decision.
Moreover, a term plan calculator will help you understand what your term insurance will entail. You need to enter all your details in the form and allow it to calculate the premium based on your inputs. It can also help you determine how much cover you need to adequately protect your family’s financial requirements.
That being said, let us now discuss the reasons why you should use a term plan calculator when buying an insurance.
- It saves you time
Researching all the term plans manually can be time consuming. Moreover, you may feel overwhelmed trying to get all the estimates. But with a term insurance premium calculator, you will be able to conclude this monumental task within minutes. You only need to enter your details and rest is handled by the calculator.
- Does not need any documentation
When you are using a term plan calculator, you are not required to provide any documents. The tool is freely available online and anyone can use it.
- Helps in plan comparisons
With so many options available in the market, it can be challenging to choose the right term plan. But with the help of a term plan calculator, you will be able to assess various plans by comparing them with one another on the basis of benefits, features, and premium. You can also add riders real-time to see which ones are most affordable and suit your needs better.
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- Helps in financial planning
Term insurance premium calculator works in real-time. This can be helpful in planning your finances as you would be able to determine affordable premiums, payment frequency, etc.
- Helps in decision-making
When you invest in a term plan without knowing how much life cover your family needs, you may end up doing more damage than good. It can either lead to over-insurance that will eventually become unaffordable in the long run or leave your family with inadequate finances.
But a term plan calculator will give you a reasonable idea about the right cover amount that would be required to secure your loved ones. Therefore, it enables you to make sound investment decisions.
As you can see, term plan calculator is a useful tool that can help you in financial planning tremendously. Therefore, if you are planning to buy a policy in the near future, its advisable to use a calculator to make your job easier.