Today, you live in a world packed with competition. To prove your mettle every single of your life, you might strive hard to sustain in the competitive world for a long time. Therefore, you might tend to ignore your health while working rigorously. While you might put all your extra efforts to prove yourself, the faster pace of life can take a toll on your health.
As the breadwinner of the family, you might have financial dependents. If anything happens to you in the future, what would your family do? They might suffer financially as well as emotionally in your absence. It is imperative to secure your family’s future to maintain their current standard of living even after your demise. Therefore, you should purchase a term insurance plan when you are alive.
Term insurance is a pure protection plan, which offers financial support for a specific period. The main objective of term insurance plans is to provide financial security to your family members. Therefore, a term plan provides a payout called the death benefit to your nominees in your absence. As the beneficiaries, your family can obtain the death payout based on their convenience. However, if you survive the tenure of your term policy, you would not be eligible to receive any survival benefit.
Term insurance works towards building a secure life for your loved ones. Therefore, it provides numerous benefits for the betterment of your family. Before you purchase a term policy, let’s go through these top five term insurance benefits mentioned below:
- It is affordable
Unlike other life insurance policies, term insurance plans are cheaper. Under a term insurance policy, you can obtain substantial coverage at a low cost if you purchase it early. Since you might be less prone to severe diseases like stroke, cancer, and so forth at a young age, your premiums would be less. However, if you buy term insurance online, you can receive life coverage at a relatively low price than an offline term policy. Since online term plans do not include any third-party charges, it has minimal charges.
- It is flexible
Term insurance plans can be a flexible option. When you buy term insurance, you can choose a payout as well as select the type of policy on your convenience. A term policy allows you to select from the following payout options:
- Monthly income
- Lump-sum amount
As a policyholder, you can choose the following types of term insurance plans given below:
- Increasing cover term plan
If you have long-term goals like your child’s education, wedding, and so forth, you should select an increasing cover term plan. However, when you increase your coverage, your insurer can charge you with an additional premium amount.
- Decreasing cover term plan
You can opt for a decreasing cover term plan while nearing your retirement. During your adulthood, you might have borrowed loans from the market to fulfil your dreams. If you have past liabilities, you should use a decreasing cover term plan to pay off your debts to avoid financial burden in the future.
- It provides riders
Many insurance companies might provide riders or add-on covers under term insurance plans. Riders are additional covers to enhance the base term policy. As a policyholder, you can use these riders when your coverage might be insufficient to cover specific situations like critical illnesses, physical disabilities, accidental death, and so forth. While purchasing a term plan, look for additional riders to ensure your long-term protection under every circumstance in life.
- It allows you to save taxes
A term plan is a sub-subject of traditional life insurance. Under life insurance policies, you are eligible to receive tax benefits under Section 80C of the Income Tax Act, 1961. Therefore, when you buy a term insurance plan, you can claim a tax deduction up to Rs. 1,50,000 on your taxable income. With tax benefits, you can save more money to build a financially secure future for your loved ones in your absence.
To sum up, term insurance might have become a necessity today due to the faster pace of life. Although you might be living a healthy life today, you can never be able to predict what can happen next. With term insurance, you can safeguard your loved ones from every eventuality of life. In the end, your family’s safety is of utmost importance whether or not you are around to look after them.