Term Insurance

6 reasons why term insurance is a must buy

Nov 16, 2021

6 Reasons Why Term Insurance Is A Must Buy!

Term insurance is useful for anyone who has financial dependents. It is useful for young professionals having dependent parents, married couples in the process of family planning, budding businessmen, self-employed professionals, Investors, and in some cases retired employees as well. 

What is Term Insurance?

Term insurance does not just protect your family after death but also offers financial protection for a lifetime. It is helpful if you face any critical circumstances like critical illness or accidental deaths during the course of your life.

With a Term Insurance PlanWithout a Term Insurance Plan
  • Insurance money could be used to manage the family’s expenses. 

     
  • Useful to set off your loans and debts.


     
  • Premium as low as 0.1 percent of the total sum of insurance.

     
  • For instance, if the policyholder dies, the insurance cover maintained will be transferred to the nominee mentioned by the policyholder which can offset loans. 
  • High risk of financial instability for your family.

     
  • The burden on predecessors for repayment of loans.

     
  • Paying a high premium for the insurance amount.

     
  • For instance, if a policyholder took a loan for his child’s higher education and unfortunately dies. The loan burden will be on his children and  family.

6 Reasons Why Term Insurance Is A Must Buy

Term insurance policies offer a high life cover at a lower premium

For eg: The premium costing for an INR 1 Crore could be as low as INR 490 per month. 

Along with affordable premium, term insurance also comes with multifarious benefits such as: 

The accidental death benefit for up to 80 years, 

  • Financial cover for more than 34 illnesses for a lifetime, and 
  • A Life cover of duration up to 99 years. 

The affordable premium under term insurance can be paid wholly at once or on a monthly, quarterly, half-yearly, or yearly basis. The method of payment for premium can be opted as per the Policyholder’s convenience. 

The 6 Main Reasons you must opt for Term Insurance

      1.Provides large cover at an affordable premium cost

The term insurance plans have a large cover which can reimburse for several years of your lost earnings at nominal premium rates. These plans come with premiums as low as INR 490 per month.

      2.Safeguard to accidental death benefits & critical illness cover 

Term insurance plans also cover you with financial protection for Critical illness during your lifetime. It helps you to save your hospitalisation & medication costs while you’re still alive. It can offer you cover for more than 34 critical illnesses like cancer, heart attack, accidents, kidney failure, etc. in the course of your life & an accidental death benefit for up to 80 years.

      3.Fulfill responsibilities & protect loved ones 

Term insurance cover increases the financial security of your family. It can serve as a big compensatory medium for your family to handle all the sudden expenses. It also offers additional payouts in the situations of accidental death, if opted through a rider. 

For example: a term insurance cover of INR  1 Crore could pay-out a cover of INR 2 crores to your family in the circumstance of your accidental death. 

      4.Secure your children’s dreams for the future 

Term insurance looks after your family & your children with a decent financial cover. This financial cover could help them pursue their education & fulfill their dreams without any stress of financial instability.

 

      5.Ensure stability against financial liabilities 

The Cover attained through term insurance plans could be utilized effectively to offset liabilities & debts. T uphe reimbursements received through term insurance could assure safety for your dependents by paying out the liability repayment.

      6.Tax Benefits  

Term insurance offers tax benefits for premiums paid up to 46,800 INR under Section 80C of the Income Tax Act. Insurance covers for critical illness health riders also offer a tax benefit on the premiums paid up to 7800 INR under Section 80D of the Income Tax Act. Also, various other tax benefits under Section 10 (10D) of the Income Tax Act are allotted to your family in unfortunate circumstances.

Importance of Term Insurance During COVID 19

Term insurance has become of utmost significance in the times of Covid in order to cover your family against critical illness or death caused due to Covid 19.

How?

  • In these times, term insurance could be a big booster to your family’s financial security that would provide options to add Covid 19 riders. 
  • You can check with your insurer and ask for the availability of a Covid 19 rider to get an additional diagnosis or avail of death benefits. 

This would cover your financial expenses and present a decent cover to your family.

 

What to check before selecting the best term insurance plan?

You should check for the Claim settlement ratios, the financial capability of your insurer, critical illness benefits offered, and an option of adding accidental death benefits. A perfect term insurance plan would also include a financial waiver for future premium payments in case the person goes through a terminal illness.  

Conclusion

Term Insurance plans could provide a brilliant cover at affordable premiums that could pose financial stability to your loved ones. While opting for term insurance, you must be assured of some pre-set parameters to select the best term insurance plan and make sure you and your family are secure against unforeseen conditions. 

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