Term insurance is a type of life insurance that provides coverage for a specific period of time or years, i.e., a term. This type of life insurance provides a financial benefit to the nominee in case of the unfortunate demise of the insured during the policy term. Term Insurance policies provide high life cover at lower premiums.          Anyone with financial dependents should buy a Term Insurance Policy. This includes married couples, parents, business people and self-employed, SIP investors, young professionals with dependent parents, and in some cases, even retirees.

TERMS RELATED TO TERM INSURANCE
Here are some terms you must know:

Claim Settlement Ratio:
The Claim Settlement Ratio (CSR) is the ratio of the total number of claims raised in a year and the number of claims settled in a year by an insurer. The higher the number, the more reliable the insurance company is, as the chances of your family’s claim being rejected are low

Term insurance premium:
This is the money you pay to the insurance company in return for financial protection. Premiums can be made in monthly, half-yearly, and annual instalments. Premiums tend to increase as you age

Add-on benefits (riders):
To enhance the coverage of your plan, you can add benefits to your plan, such as a critical illness rider, an accidental death rider, or a permanent disability rider. Riders come at a nominal cost over the premium

Sum assured:
This is the amount of money that your nominee will receive in case of an unfortunate event. This also determines the premium amount for the term plan

Death benefit:
This is the same as a sum assured and is given to the nominee in case of an unfortunate eventuality