What Is A Term Plan Calculator? How Does It Work? Know All About A Term Plan Calculator In This Guide
- April 13, 2022
- Shubham Sachdeva
- Posted in Finance
Finding the best term insurance is the toughest part of purchasing term insurance. All the other subsequent procedures are relatively much easier and less time-consuming. The best way to ensure that you too select the best plan is to make sure you compare all the available plans, that too from every insurer. This can be a tedious task, especially for a first-time insurance buyer. But there is a solution to comparing several plans and finding the best one among them: Term Plan Calculator. A term plan calculator has all the provisions to help the insurer find the perfect plan that remains in their budget. Here, you will learn more about them in detail and their functioning, features, usage, and benefits.
Image Source: Shutterstock
How Does a Term Calculator Work?
A term plan calculator is an online term insurance calculator which helps calculate the premium amount of term plans. It uses several methods of comparison within databases to find a perfect plan based on the user’s inputs. A term plan calculator also shows the plans from which the user can select the most suitable plan. When the user inputs their personal details in the calculator, it cross-verifies all the plans to see which one fits the user’s requirement. And more importantly, it can show a plan that provides the desired assured sum.
Apart from these data input boxes, some calculators have sliders to choose integer values. So instead of inputting the number, the user can slide the slider to the desired value. After receiving the final result from the calculator, the user can modify some input details if they feel the plan does not fit their budget. The same is applicable when they feel the assured sum is inadequate and needs more investment, which they are capable of paying. After tweaking all the available inputs to their budget and expected returns, the user will finally obtain the perfect plan.
What Are the Features of A Term Calculator?
As per the 2020-21 Annual Report of IRDAI, more than 2.8 crore people had started life insurance In India. This means more people in high numbers are starting to have an interest in life insurance. And all of them could benefit more if they used a term plan calculator. There are several features in a term plan calculator that add to the user’s benefit. Most of these features result in providing the best plan to the user. Given below are some commonly appreciated features of the term insurance calculator.
Personalized inputs are the most attractive feature of a term plan calculator. The user can realize how the plan in the result is the most suitable for them because of the personalization factor.
Customization of plans is also a great feature of the term plan calculator. Because through it, the user can add covers that they require and remove covers that they don’t require. In doing so, the user gets the most basic form of plan with the covers they require. And they also pay only the least amount of premium compared to plans with unnecessary covers, all the while increasing the returns from the plan by adding specific covers that they are sure they will need in the future.
Image Source: Shutterstock
These calculators also allow modification of input even after showing the results. As a result, the user can change a few inputs in the calculator and see the live effects on the final result. Modifications also help the user change the output value, i.e., the assured sum, to see how it affects the inputs values, i.e., premium amount and duration.
With personalized inputs comes personalized results. In plans with customization, the resultant plan can be a unique plan that no other policyholder or user has. Personalized results on the premium amount and assured sum ensure that purchasing the plan will never increase the financial burden on the user. Such plans are always pocket-friendly, and purchasing them won’t create any financial setbacks in their life.
How To Use a Term Plan Calculator?
Using a term plan calculator is very easy. Below is the step-by-step description of using a term plan calculator to get the best term plan.
- Input personal details
- Input desired assured sum
- Input desired term duration
- Input desired payment frequency
- Press calculate
- Verify the results
- Modify plan according to requirements
- Add/remove covers
- Finalize the plan and move forward with the purchase
All this information on the term plan calculator will help you know the importance of using a term plan calculator. It also shows the importance of using a term plan calculator more than any other method