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To err is human. However, if you are not careful, a financial misstep can have negative effects. It might be a great error to not have financial security in place to protect your loved ones in this day and age when the expense of life only seems to be rising.

Nowadays, insurance companies in UAE frequently suggest term insurance as a strategy for protection. Additionally, purchasing term life insurance is particularly crucial if you are the family's sole provider of income. But with so many plans in the market right now, it might be difficult to pick the best one.

Here are a few quick steps to follow as you choose a term life insurance plan to purchase.

• Choose One with an Adequate Cover

One of the most frequent errors we make when buying a term insurance plan is not selecting enough coverage. The most important responsibility, however, is selecting the right level of coverage, which must always be done cautiously.

It will never be advantageous in the long run to select a term insurance plan with less coverage because of the low premium required. Always take into account your age, income, career, medical history, the number of dependents you have, and your normal monthly expenses. Decide on an appropriate term plan based on such variables. 

• Determine the Tenure of Your Plan

Once you know how much coverage you require, you should also be aware of its tenure. The duration shouldn't be too short because the coverage could expire before you have paid all of your debts. The term should be brief, though, as a protracted tenure would result in an unreasonably high premium.

Calculate the year in which your liquid net worth, or the total amount of investments you have in mutual funds, provident funds, stocks, etc. after deducting your liabilities, would exceed the term life insurance cover that we have calculated in the previous section. This is the correct way to estimate the tenure of your term life insurance plan.

• Online/Offline Mode

Examine your online or offline options for obtaining a term plan. Nowadays, the majority of consumers choose online term plans over offline ones because they are more affordable. In addition to being cheaper, they can be purchased instantaneously with only a click of a button and without having to undergo any testing (for a certain age group and up to a particular sum assured).

Insurance can be purchased via an insurance broker in Dubai or the business. Another choice is to go to insurance aggregators' websites, which provide similar quotes for the same amount of coverage and term. Often, direct platforms and aggregators offer a lower premium.

• Insurance Riders

These are extensions that can be added to the basic term plan in order to increase protection. Some riders that can be added to a term insurance plan include waiver of premium, critical sickness benefit, accidental death benefit, disability income, and expedited death benefits. 

When you add add-ons to the base plan, you will pay an extra fee. This is why it's crucial that you assess your risks and decide whether you want to use riders after doing so.

There are mainly four riders that are available:

• Cover for Critical Illness

When a disease listed as a critical illness in the policy is discovered to exist in the policyholder, a lump sum payment is made to the policyholder.

• Additional Cover for Death due to Accident

This sum will be paid to you in addition to the basic sum assured in the event that you pass away due to an accident while the policy is in effect.

• Waiver of Premium on Disability

Future premiums for the policy would not be due if the insured suffered a permanent disability while it was in effect.

• Waiver of Premium on Critical Illness

Future premiums for the policy would not be due if the policyholder received a diagnosis of one of the critical illnesses listed in the policy during the policy's term.

Two of the four riders—the waiver of premium for severe illness and the waiver of premium for disability—have a low premium. The most expensive rider is critical illness insurance. As a result, you need to do some study to determine whether the extra benefits are worth the fee. And be sure to study the details of any add-on because they can vary depending on the insurance provider.

Benefits of Term Insurance Plans:

Still not convinced? Here are some of the benefits of term insurance plans that you can attain:

1. Easy to Understand

The ease of use of term insurance is one of the elements boosting its popularity. Term life insurance is a specific kind of life insurance that is only intended to pay out the covered amount to your dependents in the case of your demise. It is just necessary that the premium be paid on time.

2. Low Premiums

The low premium costs of term insurance are one of its other primary advantages. The premiums for term insurance are clearly the lowest of any other sort of life insurance plan. The fact that premium costs are based on age is another significant benefit of term insurance. Therefore, the premium for a term plan will be less the earlier you get it.

It is Crucial to Choose the Right Term Insurance Policy

There are many different term insurance options with different benefits on the market. However, it would be beneficial if you did not adopt a one-size-fits-all strategy when thinking about the benefits of term insurance.

Based on your financial obligations, you should take out enough life insurance, and depending on the type of coverage you want, you should choose the proper add-ons. Before you purchase a term insurance plan, keep in mind that there are a number of aspects as explained above that you should be aware of. 

For better guidance contact us today, as we have comprehensive knowledge of the industry and a systematic method of finding the best insurance policy for you. This makes us known as one of the leading insurance companies in UAE.