Term Insurance Vs Life Insurance: What's the Difference? and Should one Buy Life Insurance or Term Insurance? · Content Duplication Tool

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Glossary

Disclaimer - This article is issued in the general public interest and meant for general information purposes only. The views expressed in this blog are solely those of the writer and do not necessarily reflect the official policy or position of Canara HSBC Life Insurance Company Limited or any affiliated entity. We make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability, or availability with respect to the blog or the information, products, services, or related graphics contained in the blog for any purpose. Any reliance you place on such information is therefore strictly at your own risk. You should consult with a qualified professional regarding your specific circumstances before taking any action based on the content provided herein.

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Disclaimer - This article is issued in the general public interest and meant for general information purposes only. The views expressed in this blog are solely those of the writer and do not necessarily reflect the official policy or position of Canara HSBC Life Insurance Company Limited or any affiliated entity. We make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability, or availability with respect to the blog or the information, products, services, or related graphics contained in the blog for any purpose. Any reliance you place on such information is therefore strictly at your own risk. You should consult with a qualified professional regarding your specific circumstances before taking any action based on the content provided herein.

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Start Young, Pay Less, Stay Secured

Coverage for spouse Block your premium rate Covers 40 critical illness

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Start Young, Pay Less, Stay Secured

Coverage for spouse Block your premium rate Covers 40 critical illness

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Family Shield: Enhanced Protection

3 Plan options Life cover till 99 years Steady income benefit Block your premium at inception

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Family Shield: Enhanced Protection

3 Plan options Life cover till 99 years Steady income benefit Block your premium at inception

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Fixed Returns, Zero Risks & Worries

4 Plan options Life cover + Guaranteed benefits Accidental death benefit Premium protection cover

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Fixed Returns, Zero Risks & Worries

4 Plan options Life cover + Guaranteed benefits Accidental death benefit Premium protection cover

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Life Insurance - Top Selling Plans

We bring you a collection of popular Canara HSBC life insurance plans. Forget the dusty brochures and endless offline visits! Dive into the features of our top-selling online insurance plans and buy the one that meets your goals and requirements. You and your wallet will be thankful in the future as we brighten up your financial future with these plans.

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Life Insurance - Top Selling Plans

We bring you a collection of popular Canara HSBC life insurance plans. Forget the dusty brochures and endless offline visits! Dive into the features of our top-selling online insurance plans and buy the one that meets your goals and requirements. You and your wallet will be thankful in the future as we brighten up your financial future with these plans.

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Difference between Term Insurance and Life Insurance

Term insurance and life insurance are the two most popular insurance policies in India. While term insurance provides large coverage for a fixed duration, a life insurance policy offers lifelong coverage to the policyholders.

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Term Insurance v/s Life Insurance: Key Differences

Coverage: Term insurance plans only provide coverage in the event of the policyholder’s death within the period of the policy, whereas a life insurance policy is a dual benefit for its owners. It provides both death as well as maturity benefits to the insured. It is a sort of investment that has multiple benefits. However, the sum you avail at the expiry of life insurance is much lower than the amount that is benefited from term plans in the form of death benefits. Many insurance buyers prefer buying life insurance policies due to the dual benefit they provide, but it is recommended to always buy at least one term insurance, as you get a high sum at low premiums as compared to life insurance plans.

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Begin securing your future

For example, a term insurance policy with a cover of Rs 50 lakhs will have a premium of about Rs 7,000 per annum for a 30-year-old individual. A life cover of a similar death benefit would have a premium of Rs 1 lakh to Rs 5 lakhs per annum depending on the benefits.

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Term Insurance v/s Life Insurance: Key Differences

Premium Amount: When it comes to life insurance, higher coverage typically comes at the cost of a higher premium. As a result, many buyers may not be able to afford sufficient coverage under traditional life insurance plans. Additionally, the returns on such plans often range between 5%–7%, and these returns can be reduced further if the policy is surrendered mid-term. Administrative charges and policy fees also eat into the overall returns. In contrast, term insurance plans are significantly more affordable. They offer high coverage at a much lower premium, making them accessible and efficient for pure risk protection. For example, a 35-year-old individual can secure a term policy of ₹20 lakh for 20 years at an approximate premium of just ₹6,000 per year. On the other hand, a traditional endowment policy with no profit offering the same coverage may cost around ₹60,000 annually, while a with-profit endowment policy could cost ₹1,00,000 or more per year. Clearly, for those primarily looking for risk coverage, term insurance offers greater value at a fraction of the cost. Therefore, the term insurance plans turn out to benefit more those people who are not financially strong and cannot afford much for their family, or they don't have a stable source of income and proper job security.

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Flexibility: Surrendering a term insurance plan is much easier as compared to a life insurance plan. You can simply stop paying the premium to stop policy benefits and the term plan lapses.

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Term Insurance v/s Life Insurance: Key Differences

Surrender or Conversion to a Paid-up Policy: Some life insurance plans offer certain benefits even if you stop paying premiums due to unforeseen reasons. If you have paid premiums for a minimum specified number of years, your policy may continue as a paid-up policy instead of lapsing entirely. In a paid-up policy, the sum assured is reduced proportionally based on the premiums paid, but the coverage remains active until maturity or claim. At any point, if you decide to discontinue the policy altogether, you can surrender it. Upon surrender, you will receive a surrender value, which is a pre-calculated amount based on the terms of the policy and the premiums you’ve paid. This feature offers a level of financial security and flexibility, even if you're unable to continue with the original premium payment schedule. Term insurance plans, on the other hand, typically do not offer paid-up or surrender benefits. If you stop paying the premium, the policy simply lapses, and no benefits are paid. Since term plans are designed purely for risk protection and not for savings, they do not carry a cash value or offer any maturity benefits.

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Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised to exercise their caution and not to rely on the contents of the article as conclusive in nature. Readers should research further or consult an expert in this regard.

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Disclaimer - This article is issued in the general public interest and meant for general information purposes only. The views expressed in this blog are solely those of the writer and do not necessarily reflect the official policy or position of Canara HSBC Life Insurance Company Limited or any affiliated entity. We make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability, or availability with respect to the blog or the information, products, services, or related graphics contained in the blog for any purpose. Any reliance you place on such information is therefore strictly at your own risk. You should consult with a qualified professional regarding your specific circumstances before taking any action based on the content provided herein.

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Start Young, Pay Less, Stay Secured

Start Young, Pay Less, Stay Secured

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Family Shield: Enhanced Protection

Family Shield: Enhanced Protection

Fixed Returns, Zero Risks & Worries

Fixed Returns, Zero Risks & Worries

Life Insurance - Top Selling Plans

Life Insurance - Top Selling Plans

Difference between Term Insurance and Life Insurance

Term Insurance v/s Life Insurance: Key Differences

Begin securing your future

Term Insurance v/s Life Insurance: Key Differences

Begin securing your future

Term Insurance v/s Life Insurance: Key Differences

Begin securing your future

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