What are incremental term insurance plans?
Close
Close

Buy a Life Insurance Plan in a few clicks

Now you can buy life insurance plan online.

Kotak e-Term Plan

Protect Your family’s financial future with Kotak e-Term Plan. Know more

Kotak Assured Savings Plan

A plan that offer guaranteed returns and financial protection for your family. Know more

Kotak Guaranteed Savings Plan

A plan that offers long term savings and insurance in one premium. Know more

Kotak e-Invest

Insurance and investment in one plan with Kotak e-Invest. Know more

Kotak Health Shield

Insurance against medical expenses related to heart, brain, liver and Cancer. Know more

What are incremental term insurance plans?

What are incremental term insurance plans?
  • 16th Jun 2022 |
  • 1,676

One of the best things that you can do to safeguard your family’s future is purchase a term insurance policy. A term insurance plan requires that you pay regular premiums to the insurer and if, under unfortunate circumstances, you pass away, your family will receive a lump sum claim amount known as the death benefit or the assured sum. In your absence, your family won’t have to worry about expenses since the payout has the potential to cover everything from your children’s education, marriage, daily expenses, EMIs etc.

Now a vanilla term insurance plan might just work for you. But you do also have to consider inflation and decreasing purchasing power of consumers. You bought term insurance with the best intentions, to protect your family from financial troubles. But what if the insurance payout they receive is not enough? Term insurance usually lasts for 20-30 years, so we cannot accurately judge how much of an assured sum would be enough for our family so far into the future.

And herein lies the beauty of incremental term insurance plans. An incremental term insurance plan ensures that your assured sum is increased by a certain amount every policy year. This means that the assured sum 5 or 10 years down the line would be much higher than what it was initially. This can help your family counter inflation since the amount they receive would be sufficient.

Let us look at incremental term insurance in detail.

What is incremental term insurance?

An incremental term insurance plan is a type of term insurance where you can increase your policy cover by a certain amount every year. For example, if you purchase a policy of Rs. 1 crore for a period of 20 years, then for every year after you buy the policy, the assured sum of Rs. 1 crore would incrementally increase by a certain percentage amount that is decided beforehand. This means that, say, at the end of 10 years if something were to happen to you, your family won’t just receive the Rs. 1 crore, but an amount that increased incrementally over the last 10 years.

The value of the assured sum offered by a standard term insurance may depreciate over the years and your family may find that the amount is insufficient. And hence an incremental term insurance can be highly beneficial to counter inflation and ensure that your family always will have enough funds to carry on with their lives.

Premium For Incremental Term Insurance

When you have such a great benefit of having increasing life cover, there is bound to be a small caveat. As compared to regular term insurance, incremental term insurance premium may be slightly on the higher side. Additionally, the premium can either remain the same throughout the tenure or increase every year depending on the terms of the policy.

Advantages of Incremental Term Insurance

- It helps you beat inflation since the cover increases every year.

- It is economical since premiums for term insurance are very affordable.

- It helps safeguard against a future with increasing financial needs.

- It can help you save on taxes under Section 80C

Thus, incremental term insurance plans have excellent benefits. If you’re planning to buy term insurance, make sure you go for increasing term insurance to completely protect your family’s future.

Kotak e-Term Plan

Download Brochure

Features

  • Nominal Cost
  • Multiple Plan Options
  • Flexible Payout Options
  • Critical Illness Rider
  • Tax Savings
  • Long term Coverage

Ref. No. KLI/22-23/E-BB/492

T&C

Browse our library of resources

- A Consumer Education Initiative series by Kotak Life

Similar Articles

Busting Myths and Facts About Term Insurance Policies

What Is the Correct Age to Buy Term Insurance?

Why does every working women need life insurance?

Do You Need Term Insurance Cover After Retirement?

What Are the Best Term Insurance Plans for Planning Retirement?

Can I Extend the Tenure of My Term Insurance Plan?

Cost of Term Insurance Likely to Increase Soon

Why Buy Term Insurance Plan With a High Cover?

What is a short term insurance policy?

Why Spending Time with Friends is Essential for Your Mental Health?

Reasons You Need Term Insurance Plan as a Self-Employed Person

How to Buy 1 Crore Life Insurance Policy Without Medical Test

Why Buy Term Insurance Even at Rising Rates?

Zero Cost Term Insurance Plan: What is & Should you buy it?

Form 16, Form 16A, and Form 16B?

How Not To Get Your Term Insurance Claim Rejected

Difference between Section 80C and 80CCC of the Income Tax Act, 1961

9 Most Frequently Asked Questions on Term Insurance

Term Insurance: Smokers vs Non-Smokers

8 Types of Death not covered in Term Insurance Plan

Can Term Insurance Plans Be Purchased As A Gift?

How Much Cover Should I Take In A Term Plan?

Planning For Children's Future

What All Documents Required For Term Insurance In India?

All About Term Insurance Inbuilt Coverage

What Are Insurance Riders and How to Choose Them in a Term Plan?

10 Ways to Mentally Refresh After a Stressful Day

Does Your Term Insurance Plan Cover Death Due to COVID-19?

Is a Term Insurance Policy Portable?

How do I Calculate My Term Insurance Premium

6 Types of Death not covered in Term Insurance Plan

Insuring Protection Against Death With Death Insurance Rider

Make Your Online Term Plan Your Familys Monthly Payout

Term Life Insurance Plan for Smokers vs Non-Smokers

5 Benefits of Early Retirement Planning

Insuring Against Disability With Disability Insurance Rider

Should you have more than one nominee in your term insurance?

How To Choose the Right Term Insurance Plan?

Can A Housewife Buy a Term Insurance Plan - All You Need to Know

8 Factors to consider before choosing a Critical Illness Insurance

Term Insurance with Critical Illness

Why Should You Add a Rider to a Term Insurance Plan?

Everything About Claim Settlement Ratio for Term Insurance

9 Tax Changes in Budget 2019 that may Impact Your Personal Financial Planning

Does Term Insurance Cover Accidental Death?

Should You Have Multiple Term Life Insurance Policies?

What are the Documents Required for Term Insurance Plan?

Advantages & Disadvantages of Term Insurance in India

Buying A Term Insurance Plan? Take These Factors into Account

Importance of Term Insurance at Every Stage of Your Life

Should You Buy a Term Plan After 40?

Endowment Plans vs Term Plans: Understanding the difference

5 Things To Consider While Buying Term Insurance Plan

भारत में जीवन बीमा कितने प्रकार के होते हैं?

Online vs Offline Term Insurance: Which Is The Better Option To Buy

What Happens if you Hide Facts in your Term Insurance?

Gift Your Father A Term Insurance Plan This Father's Day

4 Reasons Why You Need Critical Illness Cover

Term Plan with Spouse Cover

Understanding Term Insurance Riders

Difference Between Term Insurance and Endowment Plan

Why Married People Should Buy Term Insurance Under MWP Act?

Term Insurance: Most Common Term Insurance Myths Explained | Kotak Life

Should you buy a Renewable Term Life Policy?

Individual Life Insurance vs. Group Term Life Insurance

How To Change The Nominee in Term Insurance?

Term Insurance Plans and Policies for Smokers

How to Ensure That Your Term Insurance Claims Are Never Rejected?

5 Reasons to Buy Term Insurance When You are in Your 30s

Why Should New Parents Buy Term Life Insurance?

जीवन बीमा पॉलिसी लेने की प्रक्रिया क्या है?

10 Ways to Get Your Kids Involved in Your Healthy Lifestyle

Is ₹1 Crore Term Insurance Good Enough Cover?

What Is a Renewable Term Insurance Policy?

Is There Any Tax Benefit on Term Insurance?

What is Insurance Premium - A Detailed Guide

Why Term Insurance Is Better Than ULIP?

How Much Term Life Insurance Cover Do I Need?

Know How to Invest at Every Age for Larger Returns

Is Term Life Insurance Plan an Investment or Expense?

How To Calculate The Amount Of Term Life Insurance You Need?

Key Differences Between Term Insurance, ULIPs, And Health Insurance

टर्म इंश्योरेंस क्या है? टर्म इंश्योरेंस का मतलब

Do Beneficiaries Pay Taxes on Term Insurance?

Is term Insurance Needed for People With No Dependents?

Can I Make Changes to My Term Insurance Policy Post Purchase?

Term Insurance Basics You Should Know

Planning For Son or Daughter's Wedding

How To Choose the Right Sum Assured Under a Term Plan?

What is a Joint Term Insurance Plan? Key Benefits of Joint Term Plan

6 Reasons That Make Term Insurance a Must Buy

Which Term Insurance to Choose: Lump Sum or Staggered Pay-out Plan?

Term Insurance: What Happens When You Don’t Pay Your Premiums?

How Does A Term Life Insurance Work in India?

Choosing Riders for Insurance Plans

Is it a Good Time to Buy Term Insurance During the COVID-19 Pandemic?

Tips to Choose the Right Term Period for Term Insurance Plan

Protection for your family

5 Term Insurance Benefits for Single Women

What is the Right Term Period For Term Insurance Policy? Here's How You Should Choose!

Side Effects of Covid-19 Booster Doses

Calculating Term Insurance Premium

3 Things to Consider When Buying Term Insurance, If You are Single

Why Should You Not Take A Term Plan Without Medical Test in India?

4 Methods to Calculate How Much Term Insurance You Need

How Does Term Life Insurance Work? Learn the Benefits

Make Your Online Term Plan Your Family's Monthly Pay Cheque

What are the Tax Benefits of Sukanya Samriddhi Yojana (SSY)?

Advantages of Buying Term Insurance in Your 50s

8 Benefits of Term Insurance You Should Know

Insuring Against Accidents with an Accidental Death Insurance Rider

Is Group Term Life Insurance Provided By Employer Sufficient?

What Types of Deaths Are Covered in a Term Insurance Plan?

What is Term Insurance? Term Plan Meaning and Definition

All about Online Income Tax Calculator

Why should single women purchase term life insurance?

How to Compare Term Insurance Online

9 Ways to Help Family Members in Financial Trouble

Is It Good To Buy A Term Insurance Plan In 2022?

Tax Benefits of Term Insurance in India

Can Senior Citizens Avail Term Insurance?

Different Types of Premiums in Term Insurance?

Why 1 Cr Term Plan Is Necessary For Family?

What Is a Passive Income? Why Should You Use It to Buy a Term Plan?

8 Things To Do After Buying Term Insurance

Eligibility Criteria for Buying Term Insurance in India

Why Should You Buy Term Insurance in 2022?

Steps on How to Buy Term Insurance Online

Why Surrendering Your Term Plan Policy In The Final Phase Maybe A Bad Idea?

Is Life Insurance Investment Worthy Enough

Can Non-Resident Indians (NRIs) Buy Term Insurance In India?

Do I Need to Give a Medical Test for Term Insurance in India?

Term Insurance With Riders In India

4 Things To Expect From Your Term Insurance Plan in India

Term Vs. Whole Life Insurance: Which One You Should Buy in India?

Key IRDAI Regulations That Changed Face Of Term Insurance Industry In 2020

Different Types of Protection Plans

कोविड -19 बूस्टर खुराक के दुष्प्रभाव

Term Insurance Calculator - Everythng You Need To Know

10-Year Term Life Insurance Policy - Explained in Detail

Ideal Features of a Suitable Term Plan - Act Now for a Stress-free Future

Which Death Type Does Your Term Plan Not Cover?

9 Point Guide on how to File Income Tax Return Online

All you need to Know about Term Insurance Plans for housewives

Can I Buy Term Insurance for a COVID-19 Patient?

Should Youngsters, Working Couples Buy Term Insurance Plans?

Buying A Term Insurance? Don't Ignore the Claims Settlement Ratio

Ensure Protection Against Death, Disease & Disability With Life Insurance

Why is it important to buy term insurance plan?

Why Term Plan Should Be The First Step To Securing Your Future?

How to Surrender Term Life Insurance When You Have No Liabilities?

How Much Term Insurance Do I Need

How to Identify Term Insurance According to Your Needs?

Best Investment Plans for Children - Secure Your Child's Future

Insuring yourself against Ill Health with a Critical Illness Rider

Term Plans are Definitely Cheaper than You Think!

Term Insurance vs Life Insurance: Understand the Difference and Benefits

Can I Get Term Insurance on Behalf of My Spouse?

While Buying Term Insurance Compare Features, Not Just Premiums

Why Premium Amount for Term Insurance is So Low?

What Should Be The Duration Of Your Term Plan in India?

Can You Increase Your Term Insurance Cover?

Increasing Term Insurance and Riders

Insurance Policy for Housewife In India

What Happens to Term Insurance Plan With No Beneficiary - Kotak Life

Term Insurance Age Limit – Term Plan for All Age Groups

Why Term Insurance Is Important in times of COVID-19?

Are The Add-ons and Optional Features of Term Insurance Plans Actually Beneficial?

Comparing Term Plans – What Should You Look Out For

What is Form 16, Form 16 part A, Form 16 part B, Information Required and FAQs

What is a term insurance plan with a return of premium, and how does it work?

Why You Must Include In Your Financial Planning?

When is the Right Time to Buy Term Life Insurance Policy for Yourself?

Top 3 Reasons Why You Should Buy A Term Plan Now

What is Critical Illness Policy?

भारत में गृहणियों के लिए टर्म इंश्योरेंस

What Should You opt for - Limited or Premium Pay?

Why Buying a Term Plan Is Smarter Than Traditional Life Insurance Products