Life is unpredictable with all its twists and turns. This is where the importance of planning ahead comes to the forefront. In this context, it is worth considering a term insurance plan as a strategic move to counter future financial worries of your family. Let us find out how it works below.
Why a Term Insurance Plan is Just What You Need
How is a term insurance plan a smart move on your part? Here are some compelling reasons behind the same.
- Reasonable premiums- A term plan offers pure life coverage without any investment angle. It is the most reasonably-priced form of life insurance, where you can get relatively higher coverage for a comparatively smaller premium amount. The earlier you buy this policy, the lower your overall premium amount.
- Future financial security- A term insurance plan is a financial safety net for your family's future in case of your absence or any unexpected mishap. The sum assured will cover their day-to-day living costs, higher education needs of children, repayment of debts, and other priorities. This will keep you mentally free since you know that your family will be taken care of in your absence.
- Options for riders- You can beef up your term plan with helpful riders that ensure added protection. These include options like terminal illness, critical illness, total/partial disability, and premium waiver, among others. These offer enhanced coverage for various scenarios at nominal amounts.
- Tax advantages- Term insurance premiums will get you deductions under Section 80C up to Rs. 1.5 lakh. At the same time, any health-related riders are also eligible for deductions under Section 80D. Section 10 (10D) also ensures tax exemptions for death benefits paid to beneficiaries.
- Customization options- You can easily personalize your term plan as per your specific requirements. You may opt for level, decreasing, or increasing coverage as per your requirements. There are also payout options for death benefits, including monthly installments, lump sum amounts, and a combination of both. You can also choose to offer coverage for your spouse under your own plan.
- Coverage for longer durations- Term insurance policies come with longer tenures, up to 20 or 30 years, based on your specific requirements. You can also opt for whole-life coverage to ensure the continued financial security of your dependents throughout your lifetime.
Signing Off
These are some of the biggest reasons why planning ahead with term insurance is always a strategic move. Always remember to read the policy document carefully before purchasing it and declare any health/lifestyle ailments and habits to the insurance company while doing so.
A term insurance plan will safeguard your family in the event of any unforeseen event. This will naturally give you greater peace of mind while being a smart addition to your financial portfolio. Also, remember that the earlier you start, the better for you. You can get higher life coverage for a relatively smaller amount in this case.
