• An online insurance premium calculator serves as a tool that approximates the amount of insurance premium you will owe based on the policy you select and various factors like your age, policy term, premium frequency, and sum assured, among others. The majority of these tools and online insurance premium calculators can also be found on the official websites of the insurance companies. In most instances, you will be required to provide the following details in the online insurance premium calculator: policy name, policyholder’s age, sum assured, premium frequency, tenure, and riders.

What is Life Insurance Premium?

• A life insurance premium comprises a one-time or multiple periodic payments made by a policyholder toward his or her insurance policy. A life insurance policy functions effectively if the policyholder pays premiums in accordance with the specifications outlined in the policy document. Most policyholders opt to pay premiums on an annual, half-yearly, quarterly, or monthly basis and receive returns or coverage according to the policy selected.

• The premium for insurance differs, which is influenced by the chosen plan and the individual’s age, health status, etc. Typically, a young and healthy individual will pay a lower premium for the same term plan as an older counterpart. In addition to these, several other factors contribute to determining the premium for a life insurance plan, which is why it is essential to understand how to calculate insurance premium.

Benefits of Life Insurance Term Plan Calculator

• An online calculator offers numerous advantages that can address many of your questions, such as how to compute insurance premium, how to calculate premium without tax, how to find out the sum assured, and so forth. Therefore, let’s examine the advantages of using an online insurance premium calculator.

• Error Free Calculations: The premium calculation process experiences very few errors since it is automated.

• The Easiest Method of Calculating Premiums: It calculates the required premium amount without the need for any manual calculations.

• To Determine the Actual Cost: It accurately identifies the total amount needed to secure one’s life. This gives a clear understanding of how much he or she desires to invest in life insurance, enabling careful financial planning.

• A Tool for Comparing and Choosing the Most Appropriate Insurance Policy: This is among the simplest ways to compare various term insurance policies. The comparison offers a lucid overview of what to select and what to avoid. This provides a solid understanding of which policies to pursue.

How to Use an Online Insurance Premium Calculator?

• To calculate the premium of an insurance plan, most online insurance premium calculators follow the steps below (Steps may depend upon the insurer):

• 1st Step : The buyer needs to enter details like Applicant’s age, gender, number of children, annual income & marital status.

• 2nd Step : Enter your expectations from the policy-

• Policy’s type or name
• Premium payment term
• Sum assured
• Additional riders that a person might like to include in his or her base plan.

• 3rd Step : Filling out the form takes only a few minutes, and after you’ve entered all of your information, the projected premium figure will appear.

• 4th Step : Compare the plans and go ahead with the best option.

Factors Influencing the Life Insurance Rate

• The amount required to secure a life insurance policy is known as the insurance premium. Numerous factors influence life insurance premiums.

• Sum Assured: The greater the sum assured, the more substantial the premium that needs to be paid.

• Age of Applicant: The age of the policyholder affects the mortality rate for that age category. This is a crucial factor in determining the premium of the policy. The younger the policyholder, the more probable it is that the insurance provider will offer a lower rate. The primary reason for this is the diminished chance of claims.

• Habits and Health Records: Unhealthy habits, like excessive drinking and smoking, lead to a higher insurance premium. In other words, individuals who engage in negative habits such as smoking and drinking are required to pay a higher premium compared to those who pursue a healthy lifestyle.

The Path Ahead

• It is always beneficial to investigate the policies you are considering purchasing. Nevertheless, whether you aim to determine the sum assured or discover how to compute the insurance premium, it would be advantageous to utilize an online insurance premium calculator, as it is mistake-free and provides an exact calculation based on your needs.

Disclaimer

• Tax advantages are according to the Income Tax Act, 1961, and are subject to any amendments made from time to time.
• The article is intended to be general and informative and should not be interpreted as solicitation content. Please review the associated product brochures for exclusions, terms and conditions, warranties, etc. , thoroughly before finalizing a purchase.

• Make prudent financial choices. Speak with your financial advisor before making any choices regarding insurance purchases.