Financial uncertainties can arise unexpectedly, making it reasonably necessary to stay prepared. When it comes to protecting your family’s financial future, one of the best solutions is to purchase a term insurance plan. Term insurance is the most straightforward and affordable form of life insurance that provides coverage for a predetermined period. In case of your untimely demise within the tenure, your loved ones will receive the sum assured. However, it’s important to maintain regular premium payments throughout the policy term to ensure the sum assured is available when needed.
Keep reading till the end to know the top benefits of term insurance and how to select the best term insurance plans that perfectly meet your needs.
6 Top benefits of purchasing a Term Insurance Plan
Whether you are the sole earner or one of the earning members of your family, having a term plan is highly beneficial as it ensures that your loved ones are financially secure. Here are some key benefits of a term insurance policy:
1. Protection against financial liabilities
Purchasing a term plan is a wise and responsible decision if you have specific financial liabilities or commitments. In case of your untimely demise, your beneficiaries will receive the sum assured. This sum can cover expenses such as outstanding debts, educational costs, and other personal or day-to-day living expenses of your loved ones, helping them maintain their standard of living. A term plan provides immense peace of mind, knowing that your financial responsibilities will be taken care of, even in your absence.
2. Affordable premium options
One of the features of term insurance is its affordability. Compared to other life insurance plans, term insurance offers competitive pricing, allowing many people to obtain comprehensive financial protection for their loved ones without straining their budget.
3. Tax benefits
Purchasing a term life insurance policy offers several tax benefits under the Income Tax Act of India. The premium amount that you pay is deducted under section 80C. You can claim a deduction of up to ₹1,50,000 under this section. Moreover, the lump sum your family gets in your absence will be tax-free under section 10(10D).
4. Adding riders to existing policy plans
Most term insurance policies allow riders to be added. You can include them in your existing term life insurance policy to increase the coverage benefits. However, your premium amount may increase marginally.
Some of the common riders include accidental death benefits, disability income, and critical illness riders. The critical illness rider is often considered valuable as it covers a range of critical illnesses. If the policyholder is diagnosed with any illnesses listed in the policy, such as heart disease or cancer, it will provide financial support to cover the cost of treatments, ensuring the policyholder receives timely medical care without compromising their savings. Eliminating financial stress during such critical times is vital for focusing on recovery.
5. Increasing coverage option
Most term insurance policies allow the policyholder to increase or decrease coverage over time, accommodating changes in their life, such as marriage or childbirth. This feature ensures that the policy remains aligned with evolving personal circumstances.
6. Easy accessibility
With simple online application processes, term insurance plans are easy to purchase. This streamlined approach allows individuals to obtain coverage quickly and with minimal paperwork, making term insurance a convenient option for securing financial protection.
Selecting the right term Insurance Plans
Choosing the best term insurance plan requires considering several essential aspects to ensure it fits your family’s requirements and financial objectives.
- First, determine the right coverage amount by considering future living costs, education, and outstanding loans.
- Choose a policy tenure corresponding to the time frame during which your family would require financial assistance.
- Comparing premiums from different insurers helps identify reasonably priced solutions while analysing add-on riders, such as critical illness or accidental death.
- To guarantee dependability, consider insurers with a high claim settlement ratio (CSR).
- Selecting a flexible plan guarantees complete, long-term protection by enabling you to expand coverage as your financial obligations increase.
Final thoughts
If you have dependents, getting suitable term life insurance is smart. It will give your family financial protection and help them maintain their lifestyle in your absence. When you choose a term life insurance, compare the policy features to understand whether it suits your present budget and future financial goals.
DISCLAIMER – “Views Expressed Disclaimer: Views and opinions expressed are those of the authors and do not reflect the official position of any other author, agency, organization, employer or company, including NEO CYMED PUBLISHING LIMITED, which is the publishing company performing under the name Cyprus-Mail…more
