Not sure if term income replacement insurance is the right option for you? Let me open the door to facts and ideas. It will erase all your doubts. And you will surely make the right decision. Because when you have the right knowledge about term insurance, you can make things better for yourself and your family.
As its name suggests as a proxy for income, the insurance company agrees to pay the nominee a percentage of the monthly sum insured over a fixed number of years.
Simply put, if the life insured dies during the term of the contract, the nominee named in the insurance document will receive a regular monthly cash flow due to the loss of monthly income.
For example, a 32-year-old man opts for temporary income replacement insurance with an insured amount of Rs 50 lakh. Opt for the 35-year plan as your political period. Let’s say the life insured dies at the age of 52, his candidate, his wife, as mentioned in the policy, receives a percentage of Rs 50 lakh (insured sum) for a certain number of years. Once the full insured amount has been paid to the nominee, the policy ends and no further payments are made to the nominee.
The above case is the simplest example of risk insurance. The other variations that most life insurance companies offer under the term income replacement insurance are discussed in the other section of this article.
Another thing to know is that most life insurance companies offer customization of the term income replacement insurance plan. You can customize the plan based on the insured amount, the duration of the contract, the monthly payment, etc.
Temporary income replacement insurance is death benefit insurance. There is no benefit at maturity. If the life insured dies during the life of the policy, the nominee will receive a percentage of the insured sum each month as replacement income due to the loss of income.
Therefore, you must purchase income replacement insurance: