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5 ways you can lower the premiums on your term plans

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5 ways you can lower the premiums on your term plans
October 31, 2023

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The cost of medical care and health insurance in India has been steadily increasing for years, and now, with the COVID-19 pandemic, it has reached an all time high. While two-thirds of Indians today have life insurance policies, only a fifth of the population has invested in a term insurance plan. Term insurance is actually the cheapest insurance plan available in the market in comparison to other policies. It creates a wide coverage creating the perfect safety blanket for your family members as beneficiaries in case the policyholder dies during the term granted as per the policy.

Benefits of Term Insurance

term life insurance plan offer key benefits for those that opt for the policy:

  1. Death Benefit Lump Sum:

    A lump sum amount is paid to the beneficiaries in case of the death of the policyholder during the term granted. This allows the beneficiaries to keep up their lifestyle and fulfill their daily needs which is especially important in the event that the policyholder is a primary breadwinner in the family.

  2. Wide Coverage:

    The policy in question can account for sudden death, death due to accident, or death due to illness or disability. This is a wide coverage and will leave less room to worry.

  3. Tax Benefits:

    The premium paid for life insurance policies is-exempt from tax up to a lakh and a half rupees in a given Financial Year under section 80 C of the Income Tax Act of India (1961).

How to reduce your premiums?

Any insurance plan that one opts for should be seen as an investment, especially with the monthly or annual premium payments. However, it is possible to further reduce the premium payments with a few simple steps:

  1. Be proactive:

    the earlier you invest in term insurance, the more advantages you can reap from the plan. Age plays an important role in term insurance, therefore a person in their 20s and a person in their 30s could opt for the same plan, yet the latter would be requird to have a higher premium to be paid in comparison. Hence, the 20 year old can get the same policy and afford it for a longer period of time in comparison to a 30 year old.

  2. Yearly payments:

    Instead of opting for monthly or biannual payments, one should choose to pay annually. This option may actually help save money. While the payments made in quicker succession are easier on the pocket due to the smaller sum, these premium payments can add up and can actually prove to be a larger sum than if one were to make a yearly premium payment. It may be a larger sum, but it could be more helpful in the long run.

  3. Term of the policy:

    The period one opts to keep the policy active for, can impact the payments made for the same. Therefore, policy term is a key factor in saving money via premiums.

  4. Take care of yourself:

    If you are prone to illness or have taken up any habits that could affect your health in the long run such as smoking or drinking. Or you live a high-stress life, you need to look out for your own health to stay at arms length from any disease or disability you could be susceptible to. Additionally, any of these habits or conditions could increase your risk quotient which would push the insurer to increase the premium that needs to be paid. The healthier you are, the lower the premium.

  5. Opt for online:

    The internet has become a saviour since the onset of the COVID-19 pandemic, allowing the world to adapt to a new lifestyle altogether. With mulitple chatbots available for HDFC Life, accessibility is not an issue. Opting for HDFC Life Click2Protect Life is a great way to get started. This way, you stay safe at home while all the information is a click away.

HDFC Life Click 2 Protect Life (UIN No.: 101N139V01) is a Non Linked, Non Participating, Individual, Pure Risk Premium/Savings Life Insurance Plan. Life Insurance Coverage is available in this product.

ARN: ED/03/21/23136

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Francis Rodrigues Francis Rodrigues

Francis Rodrigues has a decade long experience in the insurance sector, and as SVP, E-Commerce and Digital Marketing, HDFC Life, manages the online sales channel, as well as digital and performance marketing. He has had hands-on experience in setting up sales channels and functional teams from scratch over a career spanning 2 decades.

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Vishal Subharwal Vishal Subharwal

Vishal Subharwal heads the Strategy, Marketing, E-Commerce, Digital Business & Sustainability initiatives at HDFC Life. He is responsible for crafting and ensuring successful implementation of the overall organisation strategy.

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