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An insurance plan plays a crucial role in safeguarding you and your family against life’s uncertainties. Among these, term insurance stands out as a pure life insurance policy that provides financial protection to your beneficiaries if you pass away during the policy term. Unlike other plans, it does not offer any savings or investment returns.

Insurance expert Nikhil Jha recently emphasized on social media that term insurance is the only life insurance worth buying. He explained that term insurance is straightforward protection - no returns, no gimmicks, just reliable financial security for your loved ones if something happens to you.

“Life Insurance Gyan: Term life insurance is the only life insurance to buy. Don’t be fooled by LIC or other insurers pushing policies with guaranteed returns after many years. Mis-selling is the biggest scam in life insurance,” Jha wrote on X.

He pointed out that many people get trapped into buying expensive endowment plans, money-back policies, or guaranteed return schemes aggressively marketed by LIC and other agents. These policies promise maturity payouts after 20 to 30 years but often come with poor returns (around 4–5%), high commissions, and long lock-in periods that aren’t clearly disclosed.

Term insurance in today’s context

Term insurance offers a cost-effective way to ensure your family is financially protected if you die during the policy term. Compared to life insurance plans that combine maturity and death benefits, term plans have lower premiums. They can also be tailored to fit your specific needs.

In contrast, whole life insurance plans provide lifelong coverage along with investment benefits. These plans often cover up to age 100 and allow cash accumulation over time. Policyholders can also add riders like critical illness coverage for extra protection against medical emergencies.

While life insurance plans can help accumulate wealth through savings or investments, term insurance focuses solely on providing financial security for a fixed period at an affordable price. Both require premium payments, which guarantee the benefits outlined in the policy.

Life insurance plan vs. term insurance plan

A life insurance plan offers financial security for your family if you pass away and also includes a cash accumulation feature to support future financial goals. Policy terms can range from 5 to 30 years or even cover a lifetime. If you die during the term, your beneficiaries receive a lump sum death benefit to cover expenses like debts, children’s education, medical bills, or daily costs.

Term insurance, however, covers you only for a specific period but usually provides higher coverage amounts at lower premiums.

Premium comparison: life insurance vs. term insurance

Buying insurance early in life usually means lower premiums. Some insurers provide coverage for partial or permanent disability affecting your income during the policy term.

The key difference is that term insurance does not pay any maturity benefit if you survive the policy term, which keeps premiums lower. Despite this, term plans guarantee a minimum sum assured payment if the insured event occurs during the term, making them affordable yet comprehensive.

Both term and life insurance protect your family financially in case of premature death. Life insurance plans often include a survival benefit, paying a lump sum if you outlive the policy term, which can serve as a retirement fund or financial safety net.

In summary, term insurance is the most straightforward and cost-effective way to secure your family’s financial future, while other life insurance plans mix protection with investment but often at a higher cost and with lower returns. Avoid falling for mis-sold policies promising guaranteed returns and focus on pure protection through term insurance.

Experts Approach

Bimacure, as an expert insurance consultant, is committed to helping policyholders efficiently address and resolve their insurance grievances. They focus on ensuring fair claim settlements and combating mis-selling practices to protect the interests of both customers and insurers. By providing expert guidance and support throughout the complaint process, Bimacure helps policyholders navigate complex insurance issues and secure the compensation they deserve. Their dedication makes them a reliable partner for resolving insurance disputes effectively and transparently.