Term insurance plans are renowned for providing high coverage at a relatively low premium than other products. Continue to read to learn the various payment methods available for a term plan to choose the best one as per your requirements.
Term insurance plans are essential to financial planning for many individuals in India. These plans provide financial protection to the policyholder’s family in case of an unfortunate event leading to the policyholder’s untimely death.
With so many payment methods available today, knowing the best methods to pay for a term plan premium is crucial to ensure a hassle-free experience.
Popular Payment Methods for Term Plans
● Online Payment
It is one of the easiest and quickest ways to pay for a term insurance plan. Moreover, online payments today are very secure. The policyholder can receive an immediate confirmation once the payment is processed. Additionally, it is a convenient way of making payments from the comfort of your home or office.
Yan can use your debit/credit cards, net banking, UPI, or mobile wallets to pay a term life insurance premium online.
● Automatic Payment
Also known as standing instructions, it can be one of the best ways to pay term plan premiums for those who don’t like remembering premium dates. The policyholder authorises the insurance company to deduct the premium amount on the due date. The insurer automatically deducts the premium amount from the policyholder’s bank account.
This ensures that you do not miss out on any payments so that your policy stays active.
● Payment through Branches
You can visit the nearest branch office of your insurer and make payments through cash, cheques, or demand drafts. However, this payment method may not be as convenient as online payment or standing instructions.
3 Different Premium Payment Modes Available for Term Plans
One of the essential considerations while selecting a term life insurance plan is the premium payment mode that fits your financial goals and objectives. The good news is you can choose from different types of premium payment modes according to your needs.
1. Single-Premium Payment
This is a one-time premium payment mode where you pay the premium upfront in a lump sum. Single-premium payment can be suitable if you have a lump sum amount to purchase a term plan.
2. Regular Premium Payment
This is a traditional and one of the most popular term insurance premium payment modes. In this mode, the policyholder pays the premium amount at regular intervals such as monthly, quarterly, bi-annually, or annually. Therefore, planning your expenses with the regular premium payment mode may be easy. Moreover, you can pay premiums over an extended period without straining your pockets.
3. Limited Premium Payment
In this mode, the policyholder pays the premium amount for a limited period, usually lower than the policy term. Once the limited period is over, the policy coverage continues until maturity. Therefore, this payment mode can be ideal for individuals who like long-term coverage by paying premiums for a shorter period.
An adequate term life insurance coverage can help your family sail through life’s uncertainties when you’re not around. So, choose the right payment mode and method and buy a term plan to stop worrying about the future of your loved ones.