No matter how much we earn each month, for most of us, the money starts disappearing by the end of the month. However, if you want to make your money grow and secure the future of your family, only saving a small part of your earning may not help. You would be required to invest the money in profitable ventures.
When we think of investments we only think of risky ventures where we have to invest our earnings for the short or long term. Seldom do we realize that buying term insurance is also a kind of investment. When you buy term insurance, you put money into it in the form of premiums. The premiums are paid either monthly, half-yearly, or annually. You have to pay the premiums until the tenure of the term plan is over. On your untimely demise, your family will get the sum assured, either in the mode of monthly or quarterly payouts or as a lump sum amount. If you can survive through the term insurance period, you will not get anything in return, however, it can be a great help to the families when they lose their only breadwinner all of a sudden. The money they get will not only help them run their life smoothly but also pay off outstanding debts if any.
Advantages of term insurance
Term insurance is one of the life insurance policies that come with a heap of advantages. Let us also discuss some of the term insurance benefits.
Financial security
As you purchase a term insurance plan, your family gets financial security, in case of your sudden demise. The members in your family who are dependent on you, the unexpected financial burden from their shoulders will be relieved. They can continue leading a smooth life financially.
Simple to comprehend
It is usually considered to be the simplest type of life insurance since it can be understood very easily. The terms and conditions are very easy to comprehend too. Term insurance provides life coverage in the form of a certain sum assured, provided you make payment of the regular premiums. The sum assured is paid to the beneficiary of the policy on the demise of the insured during the term of the policy.
Affordable
The term insurance plans provide high sum assured while the premiums are very reasonable. The premium for most plans starts from just above a thousand a month. The insured can choose the premium amount according to their affordability limits as the premium amount varies from one term insurance company to the other and the kind of term plan coverage that you choose.
Flexibility in premium payments
The premium payments come with flexibility. This means you as a policyholder can choose to pay the premium amounts monthly, half-yearly, or annually. Depending on your income frequency, you can choose the mode of premium payment.
Whole life cover
The policyholders can get whole life cover. This means a policyholder can get life coverage up to the age of 99 years; however, it much depends on the terms and conditions of the policy.
Rider benefits
Term insurance plans come with rider benefits. The riders improve the scope of the base policy. Some of the common riders include accidental benefit, critical illness, waiver of premium, etc. To add a rider, you have to pay extra premiums. However, this helps a lot in getting the kind of money that you may need in a difficult situation.
Tax benefits
Under section 80C of the Income Tax Act 1961, you will be able to avail of tax benefits on the premiums that you pay regularly towards the policy. You can claim tax benefits on premiums up to INR 1.5 lakhs. Under section 80D, the tax benefits are available only for health insurance plans.
Benefits of buying term insurance plans online
You can also buy the term insurance plans online and get many benefits such as there:
- Save the commission amount that you would usually need to pay to the agent from whom you need to buy the policy.
- Get term insurance plan quotes from several insurance providers.
- Compare the plans easily and make the best choice.
- Avail attractive discounts on the plans as the insurance companies keep coming up with several offers
You need to compare almost each of them and decide on the one that you would like to go for. For comparing the term insurance plans, you can visit the website of IIFL.