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Fall In Love with Term Insurance

IndianMoney.com Research Team | Updated On Thursday, August 01,2019, 02:59 PM

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Fall In Love with Term Insurance

 

 

Term insurance is the most sought after Life Insurance Plan to secure the financial future of your family. One can fall in love with term insurance for the kind of benefits it offers, which include pure risk cover at an affordable price.

Term insurance is convenient for couples seeking a life insurance policy, which may be individual life insurance plans or a joint life insurance policy. This article tries to emphasize the importance and the need for term insurance to secure your family.

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Fall In Love with Term Insurance

What is Term Insurance?

Term insurance is a type of life insurance which can be availed for a fixed term, in return for premiums. The term life policy supports your family financially, on death of the policyholder, within the term of the plan. Term Life Plan has no survival benefits.

See Also: Term Insurance Plans with Return of Premium

Importance of Term Insurance Plan:

The main reason why people fall in love with term insurance plans is its pure risk cover (It gives high mortality cover). Listed below are some of the advantages of term insurance plans:

  • Financial Security: Term insurance is the most effective way to secure family’s future. Term insurance helps the nominee get a lump sum in case of demise of the sole earning member of the family, within the term of the plan.
  • Basic Insurance Product: With term life insurance, you get maximum life insurance cover at affordable premiums.
  • Greater Returns: Term insurance is a pure risk plan, which doesn’t offer investment/savings benefit. The payout (death benefit) is used by nominees to repay financial obligations.
  • Low Claim Rejection: The chances of rejection of claims are lower in case your term insurance plan has been active for more than 10 years. So availing term insurance early in life, helps cover life risk as well as ensures, lower chances of claim rejection.
  • Flexible Payment Options: A term life insurance policy offers flexible premium payment. The payment option must be chosen at the inception of the policy. Policyholders can choose the regular payment plan and pay premiums on a monthly, half-yearly or annual basis. 
  • Tax Benefits: The premium paid towards a term insurance policy, enjoys tax deduction under Section 80C of the income tax act, up to Rs 1.5 Lakhs a year. The death benefit paid to the nominee in the event of the death of the policyholder is fully tax-free under Section 10(10D) of the income tax act.

See Also: How Much Term Insurance Should I Buy?

How Term Insurance Helps Secure Your Family?

A term insurance plan stands by your family and takes care of financial obligations, on death of the breadwinner. It serves as a financial cushion and takes care of the immediate financial requirements of the family, as well as compensates for the loss of income.

It helps the dependents repay existing loans, as well as takes care of children’s education or medical expenses of old parents. Term insurance helps spouse lead an independent life, without getting into financial difficulty. Term insurance is a valuable investment and a must have, if you have dependents.

See Also: Best Term Insurance Plans In India

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IndianMoney.com Research Team

The research team at IndianMoney.com comprises of certified and experienced professionals who share the company's vision to make every Indian financially literate by equipping every Indian with right and unbiased advice. IndianMoney.com research team provides newsletters, articles, videos and FAQs on various financial products and concepts only to help you make wise financial decisions.

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