Any life insurance premium that is payable for a fixed period of 5 years or 10 years is called term life insurance .Since the premium is paid for a specific period of time it is called so. Usually, the premium for this coverage is higher than that of other types. The premium amounts increase gradually over a period of time. The sum insured in a term insurance is paid to the dependents on the death of the insured.

This type of coverage does not call for standard premiums. An individual can decide the amount to be paid on the basis of his requirements in terms of coverage and affordability in terms of finance. The insured has the option of renewing the policy but at a higher rate.

Term insurance is basically a pure risk cover that takes care of risk to the policy holder or the insured. This plan is available for a limited period of time like 10 or 20 years. In other words, should anything happen to the policy holder, the nominee would receive the sum assured. If the policy holder is alive on the expiry if the term, he receives nothing.

It is a must have term life insurance especially if you are the breadwinner for the family. It is the cheapest insurance one can have and avail the benefit of a lower premium if you join young. So it would be to your advantage to buy a term cover early in life and get the benefit of maximum coverage.

Term life insurance is planned to provide a benefit upon an insured's death during a period of time. By regularly paying the required premiums during this period, the beneficiary will be paid the insured amount in case the insured person dies.

Term insurance differs from the permanent forms of life coverage, such as whole life which generally offer lifetime protection as long as premiums are paid regularly. Unlike other types of life insurance, term insurance does not accumulate cash value. You do not receive any amount at the end of the policy period as the policy simply expires.