Healthcare expenses have been increasing at an astounding pace and the standard of living individuals can afford has begun to rise as well in recent times. Covid-19 has only served to amplify these expenses. Readers are encouraged to purchase of a layer of financial protection by way of term insurance such that they as well as their family is protected.
Defining Term Insurance –
Term insurance acts as one of the most cost-effective forms of life insurance present in the market today. After paying a premium, individuals are provided with coverage for a time frame that’s been outlined in their term insurance plan of preference. In the event that policyholders die within this outlined time frame, their beneficiaries are provided with a death benefit that is payable by the insurance company responsible for issuing the term insurance policy to the policyholder.
Reasons that Make Term Insurance a Must Buy –
Term insurance is a viable investment as it provides policyholders with a number of benefits the most pertinent of which have been examined below.
Low Premiums Charged – Owing to the fact that this form of life insurance does not require any investment on the part of the policyholder, premiums charged are considerably lower in comparison to other life insurance plans. Policyholders are required to pay approximately one percent of their annual income in order to avail of life coverage.
Great Level of Flexibility – One of the primary advantages that term life insurance provides is the flexibility on offer. Policyholders may avail of their plans online or in person. Moreover, several insurance providers of term insurance allow for policyholders to alter and customize their policies in accordance with their preferences and needs. Certain term insurance policies provide incremental gains on the coverage provided during the time frame for which they are in effect. These incremental gains may arise when policyholders get married or have children. These coverage increases are provided to increase the policyholder’s financial stability.
Minimal Claim Rejections – Prior to purchasing any term life insurance plan, readers are encouraged to disclose any and all facts pertaining to their health, finances, habits, and other pertinent information. The Insurance Regulatory and Development Authority of India (or IRDAI) stipulates that insurance providers aren’t entitled to claim non-disclosure of facts after two years of the policy being in effect. This amplifies the security that term life insurance provides and reduces the chances of claims being rejected.
Add on Benefits – Policyholders are entitled to avail of add-ons that increase the coverage that is provided to them by paying a nominal fee. Some add-ons include critical illness, death owed to an accident, and partial or permanent disability.
Avail of Tax Benefits – As per Section 80C of the Income Tax Act of 1961, premiums paid for this form of insurance are entitled to tax deductions amounting to a limit of INR 1.5 Lakhs per annum. Furthermore, death benefits are entirely exempt from paying taxes as per Section 80C.
Term insurance calculator are viable tools that readers can take advantage of in order to discern what their potential expenses might be should they avail of a term insurance plan. Finserv MARKETS provide access to the same in addition to several other exciting opportunities, products and tools.