Apart from death, here’s how a term plan can also cover disability

The recent COVID-19 pandemic has shaken the entire world, making us realize the fact that death disease and disability are inevitable and anyone can be a victim of these. The importance of term insurance hasn’t really gotten in the Indian minds and many just look at term insurance as an investment that provides tax benefits. Term insurance provides protection to those who financially depend on you and should be added by everyone to their investment portfolio. But what exactly is a term insurance? Well you are about to find that out.

What is Term Insurance Policy?

A term insurance is an insurance plan that offers financial coverage to the insurance holder for a particular period of time. The subscriber is supposed to pay a monthly or annual premium for the tenure decided by both the parties. If the insurance holder of the term insurance plan dies due to some unfortunate reason, their nominee / beneficiary becomes eligible for the death benefit.

A term insurance policy can be brought by anyone who is willing to secure their family financially A term insurance plan is a good investment idea as it covers the subscriber’s nominees for a certain term. Depending on your financial responsibilities or long term goals like building a corpus for your children’s overseas education, you can choose a term insurance plan that suits your investment horizon. For anyone who is the sole earner in the family, a term insurance becomes a must for them.

Does a term plan cover disability?

Nowadays there are certain term plans that offer subscribers a dedicated return amount at the end of the premium for the premium they pay. This amount is received by the insured irrespective of their health status. Although the primary purpose of buying a term plan is to financially secure the kin of the subscriber in case of their untimely death, there are certain term insurance plans that even provide decent coverage for someone who becomes critically ill or catches a deadly disease.

There are term insurance plans that offer policyholders the option of cash payouts on conditions like being diagnosed with severe illnesses like heart attack, stroke, cancer, or multiple organ failure. These payouts can really come in handy because the cost of treating such grave illnesses can burn a hole in your pocket. Hence, investing in a term insurance plan that offers critical illness coverage is always a better idea. Such plans are fixed benefit plans offering lump sum payout. A term plan that covers critical illness can be bought as a rider with the term plan for comprehensive protection.

Another good theme about certain term insurance plans is that they offer protection against disability to the subscriber. While many people think that a term insurance plan can be an ideal way to create a strong shell against the probability of losing out on the monthly income due to the untimely demise, very few people are aware of the fact that term insurance plans are ideal source of shielding the income of the subscriber in case of disability imputed due to severe injury, something that is quite common not just here in India but across the world. A disability plan clubbed with a term insurance plan usually promises a fixed monthly income or a lump sum payment for a defined period of time to the subscriber in case he or she faces any permanent disability. In the case of total disability, the subscriber will receive the full assured amount and in case of partial disability, the insured only gets a partial sum assured.

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