What does it do?
This term plan aims to replace regular income in case of unfortunate demise of the breadwinner of the family. Death benefit is paid as monthly installments for the remaining policy term or minimum of 5 years. At the time of purchasing the policy, the applicant has to decide the monthly income that would be required by the family. The benefit amount increases at 5 per cent every year to take care of rising cost of living. Apart from regular and single premium payment options, the policy also offers a limited premium payment option which allows to pay premiums for a limited term (for example 5 years) and enjoy the insurance cover throughout the policy term (for example 20 years). Surrender is allowed only under single pay and limited pay options and the surrender value will be calculated on the basis of specified formula.
Pros
The policy gives premium discount to high sum assured policies, non-tobacco users and females.
The policy can be surrendered in case of an emergency.
It provides coverage for higher age of up to 70 years.
Premiums paid towards this policy qualify for taxation benefits under Section 80C.
Cons
The policy doesn’t offer any riders and half-yearly, quarterly or monthly premium payment modes are also missing.
