Basic Terminologies to Know in Term Insurance

List of Important Terms in a Term Insurance

FAQs About Terms to Know in Term Insurance

Can two term insurance policies be purchased together? up-arrow

Yes, you can purchase multiple term insurance policies from the same or various insurance companies simultaneously. This way, you can cover your payments during different phases of your life without hassle. Also, when it comes to multiple insurance policies, there has been a specified upper limit. Thus, qualified individuals are eligible to buy insurance benefits upto  25 times their annual salary.

Does the insurance premium change after a specified time period? up-arrow

Insurance premiums can escalate just after the end of a policy period. The insurance company can increase the claim premiums made during the earlier period if the risk involved in a specific type of insurance increases, or the cost of coverage rises.

What are the five forms of term insurance? up-arrow

Mentioned below are five noteworthy forms of term insurance:

  • Level term insurance
  • Increasing term insurance
  • Decreasing term insurance
  • Return of premiums plans
  • Convertible term plan

What is the difference between life insurance and term insurance policy? up-arrow

Typically, a term insurance policy only offers a death benefit in the event of the insured person’s death within the policy term. On the other hand, a life insurance policy provides both maturity and death benefit to the insured individual.