Various Convenient Option for Term Life Insurance Premium Payment
So, you are convinced that buying a term life insurance policy is a wise decision. What is stopping you now from buying one such policy? Is it the confusion about how to pay the term life insurance premium? Relax, now there is not just one process of term life insurance premium payment. You can choose from a plethora of options to make your insurance premium payments with utmost ease and even from the comfort of your home.
Paying a term life insurance premium is an important aspect of enjoying the coverage of the policy. Failing to pay the premium may incur fines, and your policy may also lapse due to non-payment of the premium on time. So, it is important to decide on the convenient option for a term life insurance premium payment before it is too late.
In this post, we aim to help you learn about the different life insurance premium payment options. The aim is to help you identify the most convenient and hassle-free option for insurance premium payment.
What is a Life Insurance Premium?
Before figuring out the best insurance premium payment options, we want you to know what is a life insurance premium? It is the payment that a policyholder needs to pay to an insurance company to enjoy life insurance policy coverage for the tenure of the policy. An online term life insurance premium calculator can help you get an idea of what amount of premium needs to be paid for a policy if you are still to buy a term insurance policy for yourself. There are different insurance payment methods to allow the ease of paying the premium to the policyholder. The most commonly used insurance premium payment options are monthly or annually.
Types of Premium Payment Options for Term Life Insurance
As we just mentioned that there are different insurance payment methods, so now we would like to elaborate a bit on these different insurance payment options for paying the premium. Have a look:
- Single-Premium Payment Option: As the name suggests, this is a single-termlife insurance premium payment option. Here, you are allowed to pay the complete premium for the policy in just one go. The best benefit of this single premium payment option is that it makes you worry-free about missing the due date for a premium payment. Once paid, you can rest assured of complete policy coverage without any fear of termination of the policy due to non-payment of the premium payment.
- Regular Premium Payment Option: Regular premium payment option is by far the most commonly used premium payment option for term life insurance policies. Here, the policyholder can choose to pay the premium on a yearly, quarterly, or monthly basis. The idea is to pay the insurance payment regularly at a decided interval. It is the most affordable way to enjoy life insurance coverage with any policy. It also incurs tax benefits under Section 80 C of the Income Tax Act, 1961.
- Limited Premium Payment Option: Up next, we have a limited premium payment option. In this payment option, you will pay the premium amount for a short period but gain access to the policy coverage for a longer period. With a limited-term life insurance premium payment plan, you can be well prepared for short-term careers and unpredictable situations in life.
How to Pay Term Life Insurance Premium Payment?
Gone are the days, when one needed to pay insurance premium payments with only cash or cheque. Now, there are multiple ways for paying insurance premium payments like:
- Choose Convenient Mobile Wallets: Today’s generation is keen to make payments through popular mobile wallets like Paytm, Airtel Money, MobiKwik, Phone Pe, and so on. Paying premium payment is just a few clicks away with such mobile wallets. All you need is a sufficient balance amount in these mobile wallets before paying the payment.
- Pay Life Insurance Premium with Credit Card: Another cool insurance payment option is through a valid MasterCard or VISA card. The procedure is simple, and you just need to fill in your credit card details in the form provided by the insurer to register for premium payment through credit card service. You can even register for an auto-debit payment option using your credit card.
- ATM or Automated Teller Machine: Nowadays, all the reputed insurance companies have a tie-up with prominent banks to provide the customers with a service to pay their insurance premiums via ATMs. To enjoy this facility of paying the insurance premium, you first need to register yourself with the related bank. After this whenever you will log on to any ATM, your policy details will flash and you will get an option to pay your insurance premium.
- ECS or Electronic Clearing System: Those looking for a convenient option for life insurance premium payment may also consider ECS. This automated facility will debit the insurance premium amount directly from your linked bank account on or before the due date of premium payment. For this, you must first register yourself with an ECS form along with a cancelled cheque for the initial first month.
- Official Website of the Insurer: The easiest way to pay insurance premiums is by visiting the insurer’s official website and paying the premiums through net banking, UPI, debit, or credit cards. For this, again you first need to register yourself to enjoy the e-services of the company.
Read More: Things to Know Before You Buy Term Insurance Policy
Now, that you have learned about the different life insurance premium payment options, you are aware of the pros and cons of all these methods. So, depending on your needs and financial status, you can choose a plan that meets your needs and fits your budget too. No matter, whichever premium payment option you choose, what is more important is choosing the right kind of term life insurance plan at the right time. It will help in the long run to meet the financial needs of your family in case of an unfortunate emergency.