Life insurance is the best way to secure the future of yourself and your loved ones. The banking and financial institutions now offer different types of life insurance policies that cater to the various requirements of individuals. If you are planning to secure your family’s future, this is the right time to invest in a life insurance plan. The life insurance plans are available for a definite period of time. After that period, you can renew the policy by paying the premium.
What is life insurance?
In simple terms, life insurance is a contract between the insurer or the insurance provider and the insured or the policyholder. In this, the insurer pays a specific amount to the insured individual’s nominee in case of the policyholder’s death. This insurance amount is given in exchange of a premium that the policyholder pays on a periodic basis. Many insurance plans also give tax benefits to the individual. So, one not only gets to secure the future of their loved ones, but it also helps in saving money.
Types of Life Insurance Plans
There are different types of life insurance plans:
- Term life insurance
- Endowment plans
- Unit-linked plans
- Money back life insurance plan
- Whole life insurance plan
- Child plan
- Retirement plan
Every insurance plan comes with a defined time period for which one has to pay the insurance premium. But, what if one outlives the duration of the plan? Well, it’s a bittersweet feeling. While one is happy to survive, but again one has to think about the future. In this case, you can opt for the renewal of the life insurance plan.
What is the renewal of life insurance?
As evident from the name, the renewal of the life insurance policy is a continuation of the life insurance plan. In case the policyholder survives the defined duration of the insurance plan, they can renew the policy and continue with it. For it, the policyholder needs to pay a renewal premium.
What is a renewal premium?
These are the succeeding premium or amounts that the policyholder pays to the insurer to continue with the life insurance plan. The renewal premium amount may vary from one insurance provider to another. By paying the renewal premium, one can avail of the benefits of the policy. The renewal premium starts after paying the initial premium.
If you have an insurance plan and it is about to get over, but you would like to continue availing of the benefits of the insurance plan, you need to contact the provider and ask for the renewal of the policy. Most insurance policy providers offer the facility of online policy renewal. You can log in using your user ID and password, and after that, you can go ahead and check out the terms of your policy and renew it easily.
An important point to note here is that the renewal premium will change, and it will go high. So, you must contact your provider and get complete details about the renewal of life insurance.
There are some insurance providers who have offered renewal of policy without increasing the premium amount, but again, this varies from one company to another. Hence, you must enquire about the same at the time of investing in the insurance policy.
Additional Takeaways
- The insurance policy has renewable terms. These terms highlight all the insurance policy details and the premium, in case one wishes to renew the policy. There is no need for new underwriting for this.
- The coverage gets extended, and it comes with a new premium. The renewal premium may vary from one provider to another.
- The renewal term may come with a time limit, and hence, you must check with the bank.