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The world is currently grappling with the second wave of COVID-19, shockingly even worse than the first one. The emotional and health consequences inflicted by the virus are beyond anyone imagined. As per experts, a third wave of the virus is expected to hit the world any time soon. India, too has been on the worst receiving end of the entire COVID-19 situation. Even though the COVID-19 vaccine has offered some relief in these distressful times, the situation is still not safe. The risk of falling sick and leaving loved ones without financial security is on everyone’s minds.
Importance of a term plan during the COVID crisis
In such times, the importance of term insurance comes into perspective. Since the onset of the virus, many people have realized that a term plan has more relevance in their life than a mere tax-saving* instrument. Good term insurance plans cover COVID-19 claims, bringing a ray of hope for families that suffer an unfortunate loss of the chief earning member. If you still have not got a term plan, you must invest in a comprehensive term plan life insurance at the earliest possible. However, if you already have a term policy, you can be assured of your family’s financial security, even if the COVID-19 virus takes a severe toll on your health.
Existing term plans cover COVID-19.
Term insurance policies are pure protection plans that offer financial security to your family in case of your demise during the policy tenure. The relevance of such plans cannot be underlined enough in these distressing times when the COVID-19 virus has engulfed the entire world. Term plans protect your family against future risks and offer sufficient protection to your loved ones in your absence. These policies cover death from the deadly virus (as per the IRDAI mandates) and offer the sum assured to your nominee at the time of claim settlement. Your family and dependents can use the death benefit to cover their living expenses and maintain their standard of living. Further, it will ensure your family does not compromise on their financial goals such as higher education for kids, buying a home, etc. Some term plans with COVID cover also include the diagnosis and hospitalization cost.
In times like these, when the coronavirus pandemic has led to millions of deaths and poor health all over the world, a term policy offers a much-needed monetary cushion in case of an unfortunate event.
New term plans for COVID-19
If you have not bought a term plan life insurance policy but wish to protect your loved ones from the financial distress caused by the virus, you should invest in a term policy at the earliest. Given the unpredictability of the virus, it is advised to purchase an adequate life cover. A term plan is cost-effective and can provide financial security to your family in unfortunate circumstances.
Moreover, since the COVID-19 virus has an impact on people of all age groups in diverse ways, it is best to buy a term insurance plan with additional riders1 to make the cover more exhaustive or other insurance plans that suit your requirements. Term insurance with critical illness rider can help protect you if you are diagnosed with a major ailment such as heart disease, kidney, liver, etc. When you buy critical illness insurance plans, your family gets an assured sum, which can help them cover the cost of your treatment. If the critical illness leads to your demise, the family also gets the death benefit, keeping them financially sheltered even in your absence.
Be careful with the new term plan purchase.
You can easily buy a term policy online from the comfort of your home. However, ensure to select the right insurance company and opt for an optimal sum assured. The sum should be sufficient to cover the needs of your family. Experts recommend having a sum assured that is ten times your annual income. You can calculate term plan premium online and pay as per your desired mode of frequency.
When you invest in a term plan, the insurance company will assess your premiums as per your present health condition and after careful analysis of your medical history. If you do not have COVID-19 at the time of policy purchase, the term policy will cover you in case you contact the disease later. However, if you have the virus at the time of policy purchase, your insurance company might not approve the plan. Be careful when buying new term insurance, and keep these parameters in mind at the time of making the investment:
Opt for a high sum assured to cover your dependents’ needs.
Check if the plan offers COVID-19 coverage – death, diagnosis, and hospitalization.
Do not choose a term plan only because it has economical premiums. Check the features.
Know the waiting period for different disease inclusions.
Check if the insurer has a high claim settlement ratio.
Choose a longer policy tenure for long-term security.
Consider investing in the Tata AIA term plan online to safeguard your family’s future against unforeseen circumstances like the COVID-19 pandemic. Our term policies offer protection up to the age of 100 and cover all COVID-related claims - death, diagnosis, and hospitalization. Further, you have the flexibility to choose your sum assured and premium payment terms – modes and frequency. If you opt for a high sum assured, you also become eligible for a discount on premium rates.
For term plans that provide payouts, you have the freedom to take a lump sum or monthly income payout as per your family’s needs. The sum assured from the plan can be used by your family to cover expenses such as higher education or marriage of your kids, loan repayment, etc.
Apart from investing in the right term plan life insurance, it is also crucial that you follow all COVID safety protocols, such as maintaining social distancing, wearing a mask, sanitizing, eating healthy, improving immunity, and more. By maintaining COVID-friendly behavior and securing your family with a good term plan, you can be at peace during times of uncertainties and panic.
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*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
1Rider is not mandatory and is available for a nominal extra cost. For more details on benefits, premiums and exclusions under the Rider, please contact Tata AIA Life's Insurance Advisor/ branch
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.