Term insurance provides financial protection to the policyholder’s family in case of an unfortunate event. However, before purchasing insurance, it is important to calculate the sum assured amount. A term insurance calculator can allow an individual to determine this amount.
In this article, we will discuss how term insurance calculator helps you calculate the expected returns.
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Every person wants to ensure his/her family doesn’t suffer from any financial burden in case he/she passes away untimely. One of the best ways to provide financial protection to the family is by purchasing term insurance.
A term plan can offer financial assistance to the policyholder’s dependants if he/she dies during the tenure of the plan. This amount can be used to pay for regular expenses and meet future goals. Therefore, the policyholder’s family can have financial stability if he/she dies untimely.
To ensure the family has sufficient funds, it is important to select the right sum assured. In order to calculate the estimated sum assured amount, a person can use a term insurance calculator.
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What is a Term Insurance Calculator?
A term insurance calculator is a tool that allows a person to calculate the sum assured amount. In order to use the calculator, the individual is required to submit a few details.
Here are the benefits of a term insurance calculator-
It is Easy to
Using a term insurance calculator is very easy. The person needs to enter a few details in the calculator. After that, it will calculate the sum assured amount quickly.
It Helps in Creating a Budget
While term insurance can provide the policyholder with life cover, he/she needs to make premium payments. A term insurance calculator also allows a person to calculate the premium amount. Hence, a person can choose a term insurance policy that suits his/her budget and offers the right sum assured amount.
It Helps in Comparing Different Plans
There are various term insurance plans. Selecting one can be very difficult. However, with the help of a term insurance calculator, a person can calculate the sum assured amount. Hence, a person can compare different policies based on the sum assured amount. Therefore, it can make it easy for people to buy the right policy by comparing various policies.
How to Use a Term Insurance Calculator?
There are a few steps that you need to follow to use a term insurance calculator-
- You need to enter a few personal details like- gender, date of birth, annual income, expected retirement age, current expenses, future expenses, etc.
- Once the details are entered, the calculator will calculate the sum assured amount.
What are the Factors that Impact the Premium?
Age is one of the most important factors that has an impact on premium. The lower the age, the lower the premium amount can be. Medical history also has a huge impact on the premium. The premiums can be higher for a person who has suffered from illnesses.
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