Thinking of buying a term insurance policy? Check these pros and cons to see if it fits your bill.
Pros:
- Simple and easy to understand.
- Pricing is very competitive.
- Most term policies are “renewable” and “convertible”.
- More tax benefit under section 80C.
Cons:
- Steeply increasing premiums with increasing age.
- Difficult to buy term insurance above the age of 65 or 70.
- Nothing is payable to you as there is no savings.
- Will not provide money for education of child, marriage, retirement needs.
- No loans available from term policies.
- No income or capital corpus for your family.
- No hedge against inflation.
- Wealth creation is not possible.
