March 12, 2014 8:56 am
I taken 1 crore SA term insurance for 35 years. If I am not able to pay after 5 years, what will happen? Did the reduced coverage will be available like paid up value?
Dear Vijai, pure term plans are just like your Car insurance policy. Every year you pay prem. and in case something happens (your death), the claim amount ‘ll be paid to your nominee in the policy. If nothing happens in between and renewal prem. is not paid on time, the policy lapse. No paid up value is here.
Normal term plan do not have any paid up value or surrender value. However, there are few term plans available in market which offers such thing but their prices are too high and does not makes sense.
If you have already bought one, you can check your policy document. It will have the required information. The document will clearly tell you whether there is any surrender/paid up value.
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