How Purchasing Term Insurance will Safeguard Your Family?

Benefits of Buying a Term Insurance Policy
Conclusion

In today’s world, it is extremely important for an individual to buy an insurance cover keeping into consideration various life uncertainties. This is because it helps one in planning effectively for the financial safety of their family members even in their absence. Having a term insurance cover would help the loved ones of the policyholder in dealing with the sudden financial liabilities that they might have to face in times of emergency. Moreover, purchasing a term insurance plan becomes even more important in case the policyholder is the sole breadwinner of the family.

Benefits of Buying a Term Insurance Policy

Some of the benefits of purchasing a term insurance plan are as follows:

Financial Safety

A term insurance plan safeguards the future of the policyholder’s loved ones by paying the nominee with the death benefit in the event of their untimely demise. They offer safety to the dependents of the policyholder such as their spouse, elderly parents and dependent children from having to undergo the financial burden of the policyholder during such situations.

Flexibility

Some term plans over the period of the plan duration may allow for the extent of coverage to decrease in case the policyholder has certain liabilities like in the form of a loan etc. The insurance coverage decreases with time as the liabilities get slowly repaid over this period. Also, certain insurance plans might also provide investment options that generate income over a period of time and add to the overall payout amount upon the plan expiry.

Affordable Premium

A term insurance plan is said to be one of the most popular forms of life insurance available in the market. This is because it offers a similar amount of coverage as a traditional life insurance plan at a reasonable premium amount. It is mainly because of the lower duration of such insurance plans which can be extended only via periodic plan renewal.

Tax Benefits

Tax deduction is available to the policyholder on premium paid towards term insurance plans as per section 80 C of the Income Tax Act up to a limit of Rs. 1.5 Lakh per annum. Moreover, the death benefits received are also tax deductible in some of the situations as per section 10 D, however, it may be subject to certain factors.

Coverage For Added Risk

A policyholder can enhance their insurance coverage by paying a little extra premium amount for various other additional risks like critical illness, hereditary or accidental impairments. Also, it may allow for top ups that can increase plan coverage at significant milestones in life like marriage, parenthood, etc.

Conclusion

It is extremely significant to buy a term insurance plan in order to protect the future of your family members even in your absence. Before buying a particular plan, make sure to do proper research, plan comparison based on various factors and then opt for a plan that best fits your requirements and budget.

Also read: 5 Year Term Insurance Plan in India

Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.