Savings
2024-05-14 5 Min read
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When it comes to safeguarding the financial future of loved ones, a term insurance plan is a preferred option. Uncomplicated, simple and straightforward, a term plan is indeed one of the easiest ways to get life insurance coverage. You select a policy term for which you need the coverage. This term can range from 5 to 40 years, and you can choose the most suitable. In case of your death during this term, your nominee will receive the death benefit in a lump sum. If you outlive this period, the policy will end, and there will be no payout.
While a term life insurance policy is quite simple, there are a few things that you need to carefully consider to make a well-informed decision. Apart from the coverage and the policy tenure, deciding the premium payment is also crucial. Generally, most term life insurance plans come with 3 premium payment options. Read on as we discuss each of these in detail.
Different premium payment options in a term insurance plan
1.Single Pay
One single payment of premium and you are done with your part in the term insurance. At the time of purchasing the policy, you have to clear all the premium payments at once and then no further payment is required from your end. The policy continues to cover your life until the end of the term/death of the life assured, whichever comes first.
3.Limited Pay
Limited pay under SUD Protect Shield Plus gives you the opportunity to clear out your premium in a few payments. The frequencies to choose from are 5/7/10/12/15 years. You pay a premium for a short period but can enjoy coverage for the long term.
3.Regular Pay
Someone who cannot afford single or limited pay may choose the regular pay option. With regular pay, you continue to pay the premium throughout the policy tenure. The overall premium paid under regular pay is usually higher than single pay.
One single payment of premium and you are done with your part in the term insurance. At the time of purchasing the policy, you have to clear all the premium payments at once and then no further payment is required from your end. The policy continues to cover your life until the end of the term/death of the life assured, whichever comes first.
3.Limited Pay
Limited pay under SUD Protect Shield Plus gives you the opportunity to clear out your premium in a few payments. The frequencies to choose from are 5/7/10/12/15 years. You pay a premium for a short period but can enjoy coverage for the long term.
3.Regular Pay
Someone who cannot afford single or limited pay may choose the regular pay option. With regular pay, you continue to pay the premium throughout the policy tenure. The overall premium paid under regular pay is usually higher than single pay.
The appeal of Protect Shield Plus, a single premium term plan
The appeal of Protect Shield Plus, a single premium term plan
As a non-linked, non-participating term plan, SUD Protect Shield Plus offers a high sum assured of up to ₹2 crores. People can get life cover till 80 years of age with SUD Protect Shield Plus. To suit the varying needs of individuals, SUD Protect Shield Plus offers a single-pay premium option along with limited and regular pay. The single-pay option, while a lump sum amount, can lower the premium by a significant amount.
Simply put, instead of paying for the insurance coverage over the years you pay just once and enjoy long-term coverage. Let’s take a look at the various advantages the single premium option brings for you.
1.Your policy will never lapse
One of the associated risks of a regular pay premium model is losing the policy in case you miss out on premium payments or cannot pay anymore. With a single-pay option, there are no such risks. Once you have paid the full premium, you don’t have the premium payment liability anymore. So, the chances of losing a policy are null.
2.No hassle of regular payment
With a single pay option, the premium payment is one-time and hassle-free. All the responsibilities of premium payment are done in one go, and as a life assurance, you are free to enjoy life coverage until the tenure of the policy.
3.Comparatively cheaper
A single-pay premium is comparatively cheaper than regular or limited pay. Let’s understand this with an example:
Abhay, a 32-year-old non-smoker, is working at an MNC. Abhay wants to invest in pure life insurance coverage for 40 years of tenure, so he opted for SUD Protect Shield Plus. Here is the premium he would have to pay for a ₹2 crore life cover in different premium paying scenarios:
You can clearly see that there is a difference of approximately ₹2 lakhs between single and limited pay. Hence, a single pay can be a cheaper option. If you can afford a one-time payment, it’s best to choose since it will eventually save you a significant amount.
4.Peace of Mind
A term plan ensures the financial well-being of your family in your absence, and this is a huge mental relief for any breadwinner of the family. Even those willing to leave a legacy behind for loved ones have the mental peace with a term plan.
5.Tax benefit
SUD Protect Shield Plus, like any other term plan, offers tax benefits. U/s 80C of the Income Tax Act of 1961, the policyholder can avail tax deductions of up to ₹1.5 lakhs. The death benefit remains tax-free u/s 10(10D) of the Income Tax Act of 1961.
As a non-linked, non-participating term plan, SUD Protect Shield Plus offers a high sum assured of up to ₹2 crores. People can get life cover till 80 years of age with SUD Protect Shield Plus. To suit the varying needs of individuals, SUD Protect Shield Plus offers a single-pay premium option along with limited and regular pay. The single-pay option, while a lump sum amount, can lower the premium by a significant amount.
Simply put, instead of paying for the insurance coverage over the years you pay just once and enjoy long-term coverage. Let’s take a look at the various advantages the single premium option brings for you.
1.Your policy will never lapse
One of the associated risks of a regular pay premium model is losing the policy in case you miss out on premium payments or cannot pay anymore. With a single-pay option, there are no such risks. Once you have paid the full premium, you don’t have the premium payment liability anymore. So, the chances of losing a policy are null.
2.No hassle of regular payment
With a single pay option, the premium payment is one-time and hassle-free. All the responsibilities of premium payment are done in one go, and as a life assurance, you are free to enjoy life coverage until the tenure of the policy.
3.Comparatively cheaper
A single-pay premium is comparatively cheaper than regular or limited pay. Let’s understand this with an example:
Abhay, a 32-year-old non-smoker, is working at an MNC. Abhay wants to invest in pure life insurance coverage for 40 years of tenure, so he opted for SUD Protect Shield Plus. Here is the premium he would have to pay for a ₹2 crore life cover in different premium paying scenarios:
| Single Pay | Limited Pay |
|---|---|
| The one-time premium that Abhay will pay with single pay is ₹6,90,836 | Under limited pay, Abhay chooses to pay annually for 10 years. Every year, Abhay will have to pay ₹83,916 for 10 years |
| After this, Abhay doesn’t have to pay premiums anymore | The overall premium paid by Abhay in 10 years will be ₹8,39,160 |
You can clearly see that there is a difference of approximately ₹2 lakhs between single and limited pay. Hence, a single pay can be a cheaper option. If you can afford a one-time payment, it’s best to choose since it will eventually save you a significant amount.
4.Peace of Mind
A term plan ensures the financial well-being of your family in your absence, and this is a huge mental relief for any breadwinner of the family. Even those willing to leave a legacy behind for loved ones have the mental peace with a term plan.
5.Tax benefit
SUD Protect Shield Plus, like any other term plan, offers tax benefits. U/s 80C of the Income Tax Act of 1961, the policyholder can avail tax deductions of up to ₹1.5 lakhs. The death benefit remains tax-free u/s 10(10D) of the Income Tax Act of 1961.
Conclusion
In this fast-paced world where people want everything quick, a single-pay term plan like SUD Protect Shield Plus can be a great advantage. Not just for a hassle-free premium payment, but a single pay premium also saves you from higher premiums in the long run. As discussed above, single pay is quite cheaper than regular/limited pay options. Protect the financial interests of your family by investing in a term insurance plan today!
Reference
● https://www.moneycontrol.com/news/business/personal-finance/single-premium-term-plans-should-you-opt-for-them-10921981.html
● https://economictimes.indiatimes.com/all-you-need-to-know-about-single-premium-life-insurance/tomorrowmakersshow/47367238.cms
● https://www.moneycontrol.com/news/business/personal-finance/single-premium-term-plans-should-you-opt-for-them-10921981.html
● https://bol.sudlife.in/Landing/LandingPage/a>.
Reference: SUD LIFE PROTECT SHIELD PLUS UIN: 142N088V02
● https://economictimes.indiatimes.com/all-you-need-to-know-about-single-premium-life-insurance/tomorrowmakersshow/47367238.cms
● https://www.moneycontrol.com/news/business/personal-finance/single-premium-term-plans-should-you-opt-for-them-10921981.html
● https://bol.sudlife.in/Landing/LandingPage/a>.
Reference: SUD LIFE PROTECT SHIELD PLUS UIN: 142N088V02
Disclaimer
Star Union Dai-ichi Life Insurance Company Limited is the name of the Insurance Company and “SUD Life Protect Shield Plus” is the name of the plan. Neither the name of the Insurance Company nor the name of the plan in anyway indicates the quality of the plan, its future prospects or returns.
SUD Life Protect Shield Plus | UIN: 142N088V01 | A Non-Linked Non-Participating Pure Risk Premium Individual Life Insurance Plan Star Union Dai-ichi Life Insurance Company Limited |IRDAI Regn. No: 142 | CIN: U66010MH2007PLC174472
Registered Office: 11th Floor, Vishwaroop I.T. Park, Plot No. 34, 35 & 38, Sector 30A of IIP, Vashi, Navi Mumbai – 400 703 | Contact No: +91 22 7196 6200 | 1800 266 8833 (Toll Free) | Timing: 9:00 am – 7:00 pm (Mon – Sat)| Email ID: customercare@sudlife.in | Visit: www.sudlife.in | For more details on risk factors, terms and conditions, please refer to the sales brochure carefully, before concluding the sale. |Trade-logo displayed belongs to M/s Bank of India, M/s Union Bank of India and M/s Dai-ichi Life International Holdings LLC and are being used by Star Union Dai-ichi Life Insurance Co. Ltd. under license.
SUD Life Protect Shield Plus | UIN: 142N088V01 | A Non-Linked Non-Participating Pure Risk Premium Individual Life Insurance Plan Star Union Dai-ichi Life Insurance Company Limited |IRDAI Regn. No: 142 | CIN: U66010MH2007PLC174472
Registered Office: 11th Floor, Vishwaroop I.T. Park, Plot No. 34, 35 & 38, Sector 30A of IIP, Vashi, Navi Mumbai – 400 703 | Contact No: +91 22 7196 6200 | 1800 266 8833 (Toll Free) | Timing: 9:00 am – 7:00 pm (Mon – Sat)| Email ID: customercare@sudlife.in | Visit: www.sudlife.in | For more details on risk factors, terms and conditions, please refer to the sales brochure carefully, before concluding the sale. |Trade-logo displayed belongs to M/s Bank of India, M/s Union Bank of India and M/s Dai-ichi Life International Holdings LLC and are being used by Star Union Dai-ichi Life Insurance Co. Ltd. under license.
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