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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.

Term Plan and Comprehensive Plan: Understanding the Plans

07/09/2022 |

According to a report by IBEF, life insurance has huge growth potential in India, and the premium from life insurance companies increased to ₹5.78 trillion in FY19 from ₹2.56 trillion in FY12. While these positive numbers certainly mean that the Indian life insurance company is on its path of growth, one of the few challenges that are often faced by people is the choice of an appropriate life insurance plan. Many choose to go for something simple, such as a term policy, while many others might want to opt for a comprehensive plan.

One thing that most people need to learn is that life insurance plans are to be chosen considering our needs and expenses too, which is why different plans cater to the varying needs of individuals.

Two such types of life insurance covers are term insurance and comprehensive life insurance, which are beneficial for providing a wholesome protective cover for ourselves and our families.


What is Term Life Insurance?

A term life insurance cover is a pure protection plan meant to cover your family from financial insecurities in your absence. However, if you, the policyholder, survives the policy term, then there will be no survival or maturity benefits to be availed. .


What is Comprehensive Life Insurance?

A comprehensive life insurance plan combines the benefits of term life insurance and critical ailment cover. The comprehensive plan offers a host of advantages such as accidental death benefit, a critical illness cover as well as hospitalisation benefits. Additionally, such plans also include an investment component that offers a maturity benefit through market-linked returns.

Hence, comprehensive life insurance, as the name suggests, encompasses life cover, the health and wealth goals of an individual and their family.

When choosing a comprehensive life insurance cover, it is necessary to consider all your needs as well as the emergencies that may arise in the future.


A brief comparison between term life insurance and comprehensive life insurance

Let’s take a look at some of the basic differences between the two types of life insurance to understand them better:

Term Life Insurance

Comprehensive Life Insurance

Term plans are pure protection plans.

Comprehensive plans are complete protection plans.

Premium payment mode - annual, semi-annual, monthly and quarterly.

Premium payment mode – annual

They only offer death benefits to the insured’s beneficiaries

They offer death benefits as well as survival benefits through investment returns.

No maturity benefits are offered in a regular term plan.

The fund value of the base plan is offered on maturity.



How to choose between term insurance and comprehensive insurance?


The choice between term insurance and comprehensive insurance is to be made after gauging one’s requirements rather than the pros and cons of the two plans. When compared to one another, term insurance and comprehensive insurance serve their unique purposes of pure protection and all-in-one coverage.

Moreover, each of these plans is curated to meet the financial needs of different individuals. While some seek life cover and financial protection for their family, others may want to choose an all-inclusive life insurance plan.


You should opt for term plans if:

  • You want to protect your family’s future financial needs.
  • You need an extensive life cover at affordable premiums.
  • If your loans need to be repaid in the future, without affecting your family’s finances.


You should opt for a comprehensive plan if:

  • You need more than a pure protection plan that only offers life cover
  • You need cover for medical emergencies that are more than your income can manage.
  • You want to ensure financial protection for your family in the event when you cannot generate income for your family.


TATA AIA Life Insurance Term Plans

TATA AIA Life Insurance offers an array of term plans, each designed to suit the varying needs of individuals. With the help of our term life insurance calculator, you can get suitable term life insurance quotes, ranging from a minimum amount to something more extensive, as per your needs and budget.

With the flexibility of choosing your premium payment mode with our term insurance plans, you can quit worrying about the term plan interfering with your regular expenses.


TATA AIA Comprehensive Life Insurance Plans

TATA AIA’s comprehensive life insurance plans offer a complete solution that not only provides a protective life cover for you and your family but also offer protection against medical emergencies and accidental death and disability, a range of critical illnesses and much more!

These comprehensive plans are an ideal option if one wants to make all their premium payments under a single plan.


Conclusion

While an appropriate life insurance cover is important to ensure financial protection for ourselves and our families, choosing the right kind of life insurance becomes a crucial factor. Rather than only letting your budget decide which life insurance plan you should opt for, be sure to also factor in your family’s current and future financial needs, your own financial liabilities and your flow of income.

L&C/Advt/2022/Aug/2043

 

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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

Disclaimers

  • Insurance cover is available under the product.
  • The products are underwritten by Tata AIA Life Insurance Company Ltd.
  • The plans are not guaranteed issuance plans, and they will be subject to Company’s underwriting and acceptance.
  • For more details on risk factors, terms and conditions please read the 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 does 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.