Term Insurance vs Whole Life Insurance

Term insurance and life insurance are 2 different products provided by the insurance company. Given a choice, one can choose any one of the products based on your financial ability to pay the premium and requirements in the future.

Both the policies have a common factor and serve in providing benefits to the beneficiary assigned by the policyholder.

Let’s take a look at the advantages of Term insurance:

• It provides financial security: Leaving in a world of uncertain economy choosing financial security is a must. In the eventful death, this policy will take care of your loved ones.

• Higher value returns: We normally pay higher premiums by adding addons to our insurance policy. Term insurance provides greater returns with lower premium value.

• Choose your coverage: Term insurance gives you the flexibility to choose or customize the coverage you need. You can choose the tenure and also the amount of coverage that you are looking for.

• Benefit on survival: Term insurance gives you a return on payments under the Term Return of Premium Plans (TROP). In the event of survival, you will get a return of the premium paid on maturity.

• Add-ons: Term insurance can be enhanced with additional riders provided by the insurer. These add-ons will give additional protection at a very nominal cost. Riders could be an accidental death, critical illness, partial disability, permanent disability, etc.

• Flexibility with payments: one needs not to worry or stress when it comes to the payment of premium. There are multiple choices available wherein you can pay monthly, quarterly half-yearly or yearly.

• Tax benefit: all premium paid towards term insurance can be claimed against taxation.

• Some advantages of Whole life insurance: Unlike the advantage of term insurance whole life insurance does have common benefits as well as other benefits.

• Benefit for life: choosing whole life insurance will give you coverage for life.

• Coverage assurance: Irrespective of whatever happens to you, you will be assured survival benefit.

• Works as an investment: All payments made towards the policy are accumulated, helping one as a source of cash when required.

• Borrowings: As the payments made are accumulated in an account, you are likely to borrow the amount subject to your requirement.

• Financial source: As a common factor of Term Insurance whole life insurance also provides a financial source to your family and loved ones. This policy will come in handy at the time of your retirement.

The eligibility criteria for these policies will vary based on age, coverage type, gender, and insurer.