A term insurance calculator is an online tool specially designed to help insurance buyers compute the premium they must pay for the policy they buy. Most reputed insurance companies have it on their website to help customers calculate the premium they must pay to get the desired coverage and the specific tenure they choose.
Let us look at the various uses of a term insurance plan calculator
One of the most important uses of the term insurance premium calculator is that it helps you remove ambiguity about the policy’s premium payable. Once you know precisely how much life insurance coverage you and your family needs, you can plan your budget well and decide how much you can spend on paying the premium.
Just as it is vital to choose the right coverage amount for term insurance, you must select the suitable policy tenure. The premium amount differs based on tenure. You can use the term insurance calculator to adjust the tenure and know the difference in the premium amount payable for the term you choose. Generally, the insurance advisors suggest buying a long-term policy. However, if you think the premium is beyond your budget, you can adjust the sum assured accordingly and ensure that the premium is affordable and fits within your budget.
Term insurance calculator helps you save valuable time and effort from manually calculating the premium. It gives you accurate results and eliminates the risk of human errors.
How to use a term insurance calculator?
Using the term insurance premium calculator is easy. You must enter the inputs in the relevant fields, and the tool will give you real-time results of the estimated premium you must pay. The best thing about using this tool is that it is free, and you can try different variations and combinations of the input.
- To compute the premium, you must enter vital details like your age, gender, birth date, smoking habits, sum assured, policy tenure, etc.
- Once you enter the necessary details, the term insurance calculator will show you different plans offered by the insurance company. Choose the one that you think best suits your needs.
- Next, you must choose the premium payment mode. The term plan calculator shows a table of the premium payments every month, quarter, and yearly against the sum assured you choose. You can select any option you want based on your budget and convenience.
- Based on your specific needs, you can purchase riders like accidental death, critical illness, premium waiver riders, etc. Adding any rider to your basic term insurance will increase your premium.
- Once you add the riders you want to buy, you can see the final premium. If the amount fits your budget, you can go ahead and purchase the plan, or you can re-calculate the premium by changing the sum assured.
Now that you know the various uses of the term insurance premium calculator and the steps to compute the premium use the tool to your advantage and make an informed buying decision.