• 5 Year Term Life Insurance Policy

    Life Insurance
    • Reduce taxable income by up to Rs. 1,50,000 deduction under section 80C**
    • Convenient payment options - annual, half-yearly, quarterly or monthly premium payments
    • Do more with plans that offer pure protection, retirement planning and investment options

    One can never be sure regarding what can happen in life, and death is one of the most unpredictable events that can happen at any point of time. Hence, it becomes necessary to buy an insurance plan. 5 years term insurance plans are ideal for those with immediate financial liabilities and want to ensure that their family is safe and secure from a monetary point of view regardless of whether they are around or not.

    Features and benefits of availing a 5-year term life insurance policy

    Availing a 5-year term life insurance policy means that one will get various benefits. Some of the features which make a 5-year term life insurance policy special are:

    • Low Premiums- These are the cheapest insurance policies one can avail. The premium payable will depend on factors like the persons’ age, financial requirements, etc. Payment of premiums are also flexible and one may be eligible for discounts as well.
    • Tax benefits- The insured can be eligible for various tax benefits under Section 80C of the Income Tax Act,1961.
    • Death benefit- Such plans have the sole aim of providing cover and ensuring that the insured’s family and loved ones are secured financially. In case the person dies, the nominee receives the death benefit provided the policy is still in force.
    • Surrender benefit- Some of the plans offer surrender benefits as well. That is, if the insured surrenders his/her policy before it attains maturity then he/she would be eligible to receive the surrender benefit.
    • Rider- Some term insurance plans also offer rider or add-on plans. Riders offer an extra layer of protection to the insured which helps his/her family members from a financial point of view.
    • Planning- These type of plans protects the insured who may have immediate financial liabilities and do not allow any monetary problems to burden his/her family or loved ones.

    These benefits and features might vary depending on the insurance company and the plan provided. It is always advisable to check the policy first before purchasing.

    Who can purchase this plan?

    This plan is ideal for those who want to provide cover to his/her family and other loved ones. These plans are perfect if the insured has immediate financial liabilities to take care. In case the policyholder dies due to unforeseen circumstances, the sum assured can help the nominee clear of the liabilities. This ensures that the insured’s loved ones are secured financially and they do not face any monetary burden.

    These plans are also ideal for those who want to take care of their children’s education and ensure that his/her kids are not devoid of it in any manner regardless of whether the insured is there or not in the future.

    How does this plan work?

    This type of plan works in a very simple manner. The insured purchases a 5-year term insurance policy and has to pay premiums which can be either single term payment or different premium payment modes might be available depending on the plan. In case of the death of the insured, the death benefit is paid to the nominee provided the policy is still in force. Such type of term insurance provides no benefits including the maturity benefit. No benefit is payable if the individual dies after the policy period ends. The insured will be eligible for various tax benefits under Section 80C of the Income Tax Act, 1961.

    Some of the popular 5-years term insurance policies

    Some of the 5 years term insurance policies which can be availed by a person are:

    • Aegon Life iTerm Plan- This comes with a cover starting of Rs.10 lakh and offers various flexible options to the insured.
    • LIC Amulya Jeevan 1- The premiums are designed to suit its customers’ various needs. It also boasts of having a great claim settlement figures.
    • SBI Life e-Shield- This plan offers a cover starting from Rs.20 lakh and above and can be customised as per the customer’s financial requirements.

    Frequently asked questions

    1. What documents are required in order to request a claim?

    2. Proper documents need to be furnished by the nominee including the death certificate, policy documents, hospital/FIR reports and a proper identity proof.

    3. How long does it take for the settlement of claim?

    4. The settlement of the claim will depend on the plan and the insurer generally. An insurance company does not take more than 30 days to settle a legitimate claim.

    5. What is the maximum age of entry to be eligible for such plans?

    6. The entry age may differ from plan to plan, and insurer to insurer. Generally, the maximum age might be 60 years in order to be eligible for such plans.

    7. Are discounts provided on large sum assured?

    8. Certain plans do offer discounts on a large sum assured. The discount can range from 0.5% to 1% on the premiums.

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