Call Us

FOR EXISTING POLICY

Have query on premium, payout or any servicing need?

Call us:

1 860 266 9966

Monday - Saturday | 10 am - 7 pm IST

Call charges apply

Dedicated NRI Helpdesk:

+91 22 6251 9966

Monday - Saturday | 10 am - 7 pm IST

Call charges apply

FOR NEW POLICY

Want to buy a new policy online?

Call us:

+91 22 6984 9300

Give missed call for a call back:

+91 11 6615 8748

Monday - Sunday | 8 am - 11 pm IST


Exclusively for NRIs:

Call us:

Give missed call for a call back:

+91 11 4473 0242

Monday – Sunday | 9 am – 9 pm IST

Language

Need assistance in choosing the right insurance plan? Get a call from our Expert.

Need assistance in choosing the right insurance plan?Get a call from our Expert.

+91 dropdown arrow

Select Plan dropdown arrow
  • Term plans
  • Saving plans
  • Wealth plans
  • Retirement plans
  • I don't know/I need help

TATA AIA Life Insurance Co. Ltd will send you updates on your policy, new products & services, insurance solutions or related information. Select here to opt-in. T&C apply.

8 Things to Know Before You Pay Insurance Premium

When you purchase a life insurance plan, you need to consider several factors to ascertain the death benefit to your family in the event of your unexpected death. The life insurance premium is one of the most important factors among them. The more the benefits you intend to receive from the life insurance plan, more the premium. Well, several aspects affect the life insurance premium! Therefore, let us try to understand the important aspects you need to know before paying the insurance premium.
 

Before we get started, let us understand what a life insurance premium means.
 

What Is A Life Insurance Premium?


A life insurance plan is a financial agreement wherein your insurer will provide a financial death benefit to your nominee in the event of your unexpected death. The premium is the cost that you incur for such a benefit.
 

You can pay the premium as a single payment at inception, regularly throughout the policy tenure, or regularly for a limited term. For the regular premium payment policies, you can pay the premium monthly, quarterly, semi-annually or annually based on the insurer's policy conditions. Here are a few important aspects to consider before paying the premium for such a life insurance policy.
 

Things to Consider Before You Pay The Life Insurance Premium
 


Increasing your knowledge about the life insurance premium payment in savings important to ensure maximum financial benefits. Here is a detail to help you understand them better.
 

  • Premium is paid in advance - The premium for your savings policy is paid in advance. You can pay the premium in cash upto ₹50,000. Insurers also offer life insurance premium online payment for such cases and all the other scenarios.

  • Rebates on life insurance premium - Insurance providers offer discounts on the premium for the life insurance plan. And it is referred to as the rebates. When the sum assured is more, the cost of processing and servicing such policies with the same type becomes cost-effective, resulting in more profits for the insurance providers. So, they offer rebates on the premium cost to benefit the policyholders.

    Also, if the periodicity of the premium payment is more,, the processing cost for the insurer gets more. And in the case of annual payments, the processing cost is less, and the fund remains with the insurer for a longer period, providing more returns. Therefore, insurers tend to provide rebates to people who pay their premiums annually.

    Furthermore, there are additional rebates for policyholders who choose to make the premium payment online, considering the ease of processing and the avoidance of intermediaries such as the agents in managing the premium payments.

  • More premium for specific scenarios - The life insurance premium payment can be more for certain individuals in specific scenarios. For example, if you have a health complication, it increases the probability of death risk that the insurer has to bear, causing an increase in the premium rate.

  • Level premium - The level premium is the concept of having the premium rate consistent over the entire policy tenure. It is generally offered on whole life insurance policies where the life cover is not defined for a certain policy tenure but until death.

  • Increasing and decreasing premium - Some insurance providers offer to increase and decrease life insurance benefits based on the sum assured, which corresponds to the change in premium cost. For example, suppose you want to increase the sum assured at different stages in your life based on changing family commitments. In that case, you can increase the sum assured and pay more premium. On the other hand, suppose if you feel that your children can take over the important family debts, you can call for a decreased sum assured, reducing the premium going further.

  • Life insurance premium 80C tax* benefits - The premium you pay for a life insurance plan will qualify for a tax* deduction benefit under Section 80C of the Income Tax Act, 1961, subject to certain terms and conditions. The tax* benefits of life insurance premium under 80C apply to the insurance savings plan purchased for self, spouse and children. Also, the life insurance premium deduction can be upto ₹1,50,000 for a financial year. However, it is important to note that the deduction applies to many other financial savings, including the investment made in the life insurance policy.

  • Late payment or no payment of the premium - When you have purchased a savings plan for the long term and have not paid the premium on time, the benefits will not be applicable. However, insurers provide a grace period wherein you can pay the premium and ensure the benefits without extra charges. Beyond the grace period, the savings policy will lapse. Insurance providers also offer the option to revive the life insurance plan after it has lapsed by paying the overdue premiums. However, it is subject to the insurer's discretion.

  • GST1 on life insurance premium - The GST1 applicable on life insurance premium is based on the type of life insurance and is subject to change based on the government policy

    Our policy provides different premium payment options such as single, regular and limited premium payment options for the insurance savings plan. Furthermore, you can use online premium calculators to determine the most affordable premium payments. In addition, our customer service team can help you evaluate your family’s financial obligations to decide on the best and most appropriate product solution for all their financial needs.

Conclusion


The life insurance premium is one of the most important aspects of a life insurance plan. It is based on the sum assured and the policy term. Therefore, policyholders must understand certain aspects of premiums, such as the rebates, types, tax* benefits, etc., to make well-informed decisions. Therefore, ensure to save in the right life insurance plan, make sure it is affordable and stay invested in it for the benefits in the long term! 

L&C/Advt/2022/Nov/3030

Get complete protection at affordable cost & tax benefits

+91 dropdown arrow
  • +93 Afghanistan

TATA AIA Life Insurance Co. Ltd will send you updates on your policy, new products & services, insurance solutions or related information. Select here to opt-in.


 

Looking to buy a new insurance plan?

Our experts are happy to help you!

+91

Select plan
  • Term plans
  • Saving plans
  • Retirement plans
  • Wealth plans
  • I don't know/I need help

TATA AIA Life Insurance Co. Ltd will send you updates on your policy, new products & services, insurance solutions or related information. Select here to opt-in

People Like You Also Read

Life Insurance or Death Insurance: Which One Should You Choose?
Read More
People Who Need Life Insurance - 6 Types to Consider
Read More
8 Benefits of Guaranteed Income Plan You Must Know | Tata AIA Blog
Read More
6 Characteristics You Must Possess to Grow Your Wealth
Read More
Wealth Creation for Women: Financial Growth Guide for Working Women
Read More
How Life Insurance Shields Your Wealth?
Read More
ULIPs - Advantages and Disadvantages
Read More
Surrendering Your ULIP Policy? Here is the Detailed Guide
Read More
LTCG(Long Term Capital Gain) Tax Proposal: ELSS and ULIPs
Read More

People Like You Also Read

Life Insurance or Death Insurance: Which One Should You Choose?
Read More
People Who Need Life Insurance - 6 Types to Consider
Read More
8 Benefits of Guaranteed Income Plan You Must Know | Tata AIA Blog
Read More
6 Characteristics You Must Possess to Grow Your Wealth
Read More
Wealth Creation for Women: Financial Growth Guide for Working Women
Read More
How Life Insurance Shields Your Wealth?
Read More
ULIPs - Advantages and Disadvantages
Read More
Surrendering Your ULIP Policy? Here is the Detailed Guide
Read More
LTCG(Long Term Capital Gain) Tax Proposal: ELSS and ULIPs
Read More
Website Logo Image Icon

Tata AIA Life Insurance

A joint venture between Tata Sons Pvt. Ltd. and AIA Group Ltd. (AIA),  Tata AIA Life Insurance  is one of the leading life insurance providers in India. We post everything you need to know about life insurance, tax savings and a variety of lateral topics such as savings and investments in this space. You can access and read a host of different blogs, articles and pages at the Tata AIA Life Insurance Knowledge Center or get in touch with us with any queries or questions!

View all posts by Tata AIA Life Insurance

Frequently Asked Questions

What is a rebate on life insurance premiums?

Rebate in a life insurance premium is the discount provided in the life insurance premium based on the sum assured, the periodicity of the premium, the mode of payment, etc. 

Disclaimer

  • Insurance cover is available under the product.
  • The products are underwritten by Tata AIA Life Insurance Company Ltd.
  • The plans are not a guaranteed issuance plan, and it will be subject to Company’s underwriting and acceptance.
  • For more details on risk factors, terms and conditions please read sales brochure carefully before concluding a sale.
  • This blog is for information and illustrative purposes only and does not purport to any financial or investment services and do not offer or form part of any offer or recommendation. The information is not and should not be regarded as investment advice or as a recommendation regarding any particular security or course of action.
  • Please know the associated risks and the applicable charges, from your Insurance agent or the Intermediary or policy document issued by the insurance company.
  • Every effort is made to ensure that all information contained in this blog is accurate at the date of publication, however, the Tata AIA Life shall not have any liability for any damages of any kind (including but not limited to errors and omissions) whatsoever relating to this material.
  • *Income Tax benefits would be available as per the prevailing income tax laws, subject to fulfilment of conditions stipulated therein. Income Tax laws are subject to change from time to time. Tata AIA Life Insurance Company Ltd. does not assume responsibility on tax implications mentioned anywhere in this document. Please consult your own tax consultant to know the tax benefits available to you.
  • 1All Premiums, Charges, and interest payable under the policy are exclusive of applicable taxes, duties, surcharge, cesses or levies which will be entirely borne/ paid by the Policyholder, in addition to the payment of such Premium, charges or interest. Tata AIA Life shall have the right to claim, deduct, adjust and recover the amount of any applicable tax or imposition, levied by any statutory or administrative body, from the benefits payable under the Policy.