Before buying an insurance policy, you should know the advantages and disadvantages of these two.
In the time of the Corona epidemic, it has become very important to take insurance for the irregularity of life and for the safety of the family in the future. There are many types of products available for insurance in the market. Therefore, it is important to know about them before taking the right insurance policy for yourself. If we talk about term insurance and traditional life insurance, then both plans have some advantages and disadvantages. Before buying an insurance policy, you should know the advantages and disadvantages of these two.
The biggest difference between term insurance and traditional life insurance is that of the death benefits. A term insurance benefits a person only when he dies during the term period. Whereas in a life insurance policy, a person gets both death and maturity benefits. The amount of death benefit in a term insurance plan is more than the maturity benefit available in life insurance.
Most people invest in life insurance to take both benefits but at least one term of insurance can be taken as it can be taken by paying a lower premium.
Coverage and savings
In case of death of a person in term insurance, his family gets a benefit. However, in term insurance, like life insurance, maturity returns are not available.
If the person does not want to pay a higher premium and only wants to cover the death risk, then he can take term insurance. If a person wants to create an investment corpus with life cover, then he can invest in traditional life insurance.
Surrendering a term insurance policy is much easier than life insurance. In the term insurance plan, if the person stops paying the premium, then his benefits will stop getting and the policy will also end. However, in life insurance, the maturity benefit is available only when the person completes the full tenure of the policy.
In life insurance, if the person terminates the policy in the middle of the term, then he gets only the premium amount and that too is given with some deduction. Most term insurance policies can also be renewed.