With a wide variety of life insurance plans available, customers are spoilt for choice. But if you are looking for a simple and affordable life insurance plan, term insurance is one of the popular choices to go for. Most term plans tend to be pure life insurance products, offering death benefits and a choice of riders and benefits that vary depending on the plan provider.

Even within the category of term policy, there are several plans one can choose from. If you are trying to select a plan that suits you best, you can start by listing your expectations from a term insurance policy. Once you know what you are looking for, you can shortlist plans based on whether they fulfil your needs.

Here are some parameters you can apply to choose the right term insurance plan for yourself.

• Choosing affordable premiums

Term life plans offer some of the lowest premiums when compared to other life insurance plans. These plans are no-frills, plain life insurance products. They offer no returns unless you choose a Return of Premium plan or any other such variant. The more returns offered, the higher the premium tends to be.

The amount of premium you are required to pay will depend on the policy details as well as your personal details. The younger you are, the lower the premiums tend to be. Also, a lower sum assured would mean lower premiums. Once you have specified your details, compare plans by looking at the premiums.

• Choosing the right sum assured

Sum assured in a term plan is the amount that the life assured (or policyholder) can expect the nominee to receive as a death benefit. This amount should be enough to cover - any liabilities you leave behind, as well as all your family’s immediate requirements.

You can also choose a sum assured equal to your income of 10 years, so your family does not have to face any financial worries after your demise. Ensure that your sum assured is not an abstract amount, but rather a carefully calculated figure that proves useful to your nominee in the event of your death.

• Checking availability of riders & benefits

Along with the death benefit, term life insurance policies also offer other riders and benefits. This includes terminal illness benefit, accidental death benefit rider, accidental total and permanent disability rider, and more. The benefits and riders you can avail of will differ across plans and insurance providers.

When comparing plans, check for the rider options you can choose from, as well as the benefits available. Choose a plan that offers riders you would find useful.

• Choosing the right policy tenure

Your policy is expected to benefit your loved ones in the event of your death. Therefore, it would be ideal to have a term duration as lengthy as possible. Most term plans will allow a cover until the age of 75. However, if you cannot afford a plan and want to keep the duration short, you should still consider having a life cover at least until the age of retirement (this may be 58 or 60 years of age).

• Checking claim settlement ratio

Along with the policy details, one of the most important considerations when buying a policy is the claim settlement ratio. This figure signifies the insurance provider’s history of death claim settlements. You should choose an insurer that has a high claim settlement ratio. It signifies that more of their death claims have been settled, which increases the chances of your death claim being easily disbursed.

Term plans are available online as well as offline. Since they are hassle-free and relatively affordable, they are popular with most sections of buyers. If you are looking to buy one, consider the aforementioned parameters when comparing plans. It will help you settle on a plan that is right for you.