In today’s fast paced world, life has become hectic and stressful. We work hard to fulfil the obligations and dreams of our loved ones. In this dedicated pursuit, life may throw uncertainties at us cutting off resources, hampering progression. In order to secure the interests of our dependents in case of disability or death, it's paramount to find a suitable cover by means of an insurance policy.
A sound insurance policy cover provides a lump sum upon death or disability, thus taking care of basic necessities in life and also ensuring continuity in living with little bottlenecks for your dear ones. One of the most popular life insurance products in recent times, a Term Insurance plan offers high sum assured at low premium costs and simple documentation.
What is Term Insurance?
It a type of life insurance policy which provides covers life for a specified term as the name suggests. Upon death or disability of stated nature (as per the policy terms), the nominee(s) receives the sum assured in the form of a lump sum.
It must be noted that a typical Term Insurance does not come with savings benefits at the end of term. It does not accumulate cash over a period of time. What it does provide is a high sum assured at low premiums compared to a traditional life insurance product. The term of coverage ranges from 5 years to about 30 years depending on the product portfolio of the insurer. Some term policies can go an extra mile by offering a cover for more than 30 years.
Advantages of Term Insurance
Cost Effective Premium
Term insurance is the cheapest form of life insurance available in the market today. Annual premiums are affordable and come with no hidden or additional costs. Premium amount is fixed throughout the policy term and does not fluctuate.
High Sum Assured
Unlike the conventional/market linked insurance plans with nominal sum assurance at low premium, a Term Insurance plan offers relatively high Sum Assured upon death or disability. The lump sum amount payable to the nominee(s) is fixed throughout the policy term.
Appealing Term Options
The period of insurance ranges from 5 years up to 30 years. You have the flexibility to choose a term that suits your insurance needs and pay only for the term to remain insured.
Straightforward Paperwork & Fast Processing
Unlike its counterparts in the life insurance segment, a Term Insurance is easily accessible with little documentation. After a certain age limit, the applicant may have to undergo simple medical tests as a part the underwriting procedure. Otherwise, the paperwork is limited.
Customisable as Per Requirement
A range of options and riders are available as an add on to the term insurance policy such as additional lump sum for Death by Accident, Critical & Terminal Illness Cover, Waiver of Premium upon TPD (Total and Permanent Disability), Child Education Fund, Monthly Income etc.
Easy to Manage
Most of the insurers extend convenient options to manage the Term Insurance policy such as internet based insurance account, online payments for renewals etc.
Free Look Period
Almost all insurance companies offers a free look period to help you decide if you would like to continue with the policy after initiation. The policy premium minus administrative costs (like stamp duty, costs of medical tests) is refunded to the customer if they decide to return the policy.
Why Buy Term Insurance?
A term insurance is one of the easiest life insurance policies to obtain. It not only comes at nominal charges but also offers high sum assured for your loved ones thereby covering up for you financially, in your absence. Plus, the rider options cover uncertainties such as disability by ensuring continuity in income for you and family in times of hardships.
There is never a right time to buy a term insurance. It can be bought at any age, preferably when you’re young and healthy. It does not burn a hole in your pocket too!
Term Insurance In Singapore
All big players in the insurance segment in Singapore offer a wide range of Term Insurance plans with rider benefits. Companies that sell term based insurance products in Singapore are as below.
- AIA Singapore Private Limited
- NTUC Income Insurance Cooperative Limited
- AVIVA Singapore Limited
- Prudential Assurance Company (Singapore) Private Limited
- Great Eastern Life Assurance Company Limited
- Manulife Financial (Singapore) Private Limited
- HSBC Singapore
- Tokio Marine Insurance Singapore Limited