10 Life Insurance Fact Everyone Should Know

2024-08-02

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One of the most valuable decisions you can make, especially for your family, is investing in life insurance plans. Insurance has a lot of importance because it will help you look after your family by covering them in case of accidents or sudden demise.

Several people face untimely death from an illness or accident, and if you are the sole provider for your family, such scenarios will cause them trouble. They will have a hard time paying off debts, bills, looking after house expenses, and much such expenditure. You can look after such difficulties by ensuring a safe financial future for your loved ones by buying the best life insurance policy.

10 Facts about Life Insurance Plan

A life insurance policy comes with many benefits. However, there are also certain facts related to the policy that you should be aware of before buying the financial product. The must-know facts of a life insurance policy are as follows:

1. Taking care of your loved ones even in your absence

This one's obvious. If you are the provider in your family, there might be many duties you have to look after, like paying off loans and debts, paying for your child's education, buying a car, and so on. But in the case of your unexpected death, all of the burdens will land on your family's shoulders. With the help of an insurance plan, all these problems will be less strenuous on your family.

2. Debt management

Debt is not a matter that will let you live comfortably, and if you face sudden death, it will be all the more a problem for your family to deal with, having no support. In such situations, a properly chosen insurance plan will help your family out.

3. Effortlessly achieve long-term goals

If you want to buy your dream house or car, certain types of insurance plans will allow you to fulfil your long-term goals with additional benefits. One such plan is Invest 4G, and the advantages of this plan include:

Guaranteed regular income
Limited premium pay
Assured loyalty additions

This plan is a Unit Linked Individual Life Insurance Savings Plan which you can customize as per your goals and changing requirements. With an unmatched combination of Portfolio Management Options and flexibilities, this plan gives you complete control over your savings and insurance needs.

4. Life insurance complements your retirement goals

Investing in a life insurance plan is like putting money into a pension scheme or an annuity and enjoying what you have sown after retirement. Such plans assure you of a steady flow of money every month even after retirement.

5. Life insurance plans are cheaper when you are younger

If you are a student, you might take out loans for education by co-signing it with your parents or guardian. To pay back these loans, you can consider purchasing a suitable life insurance plan. Because of your young age and good health, your insurability is high, which the premiums that you will have to be will be lower.

Learn the advantages of buying a life insurance plan at an early age.

6. Helpful for your business

Insurances do not just look after you and your family, but they also take care of your business. Many policies provide death benefits, but you might know little about the several options the policies offer that can potentially help your business grow. There are two kinds of life insurance policies - (a) life insurance policy and (b) term insurance policy.

A term insurance policy renders security only for a certain period and pays out the money only if you expire during the tenure. And if you outlive the policy, the policy terminates, and the coverage expires. On the other hand, an investment-cum-protection plan provides you with a round sum at the end of the term of the policy. The cover offered may not be as high as the term insurance plans.

7. Saving taxes

With the insurance plan you buy, you can save taxes, irrespective of the policy. The premium you pay for an insurance policy qualifies for an optimum tax benefit of Rs 1.5 lakh under Section 80C, additionally also tax-free continues on death/maturity under Section 10 (D) of the Income Tax Act, 1961.

8. Means for mandatory savings

You will have to pay a premium higher than the insurance cost if you plan to purchase a conventional or a unit-linked insurance policy (ULIP). The extra money you pay, the premium, increases the cash value that you can sell, borrow, or gain as an income from the policy.

9. You may not qualify later on

Life insurance policies function on unpredictability. When you are healthy and paying life insurance plan premiums, it might seem like an extra monetary burden. However, when you fall ill or meet with an accident, you may not be permitted to buy a policy. Thus, it is vital to get insurance at an early age when your health is at its peak, rather than getting it later when there are chances of your health deteriorating.

Insurance companies permit you to append certain benefits or insurance riders to your current or new plan. The insurance riders provide added perks to your insurance plan. For instance, the untimely death benefit rider lets you utilize all or part of the money if you have less time to live due to a critical condition. You may also use the money for your medical procedures and related expenses.

Here are 5 reasons to add riders to your life insurance plan.

10. Peace of mind

Death is inescapable, but you can take measures to look after and provide for your family even after you have gone. It could be a small policy not offering much, yet it is a security you could provide to your family, helping them fend for themselves.

Purchasing insurance policies is always a good practice and the best security you could provide your family and yourselves. It is a social device that reduces or eliminates the risk of loss of life and property. Buy the best life insurance plan to protect your loved ones from any financial shock that they may get if you pass away. A safe and secured tomorrow is possible only when you have planned it right.

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