Making the Right Choice: Understanding Term Insurance Benefits
Term insurance is one of the most popular and simplest forms of life insurance. With a term plan, you can ensure that your loved ones will receive a financial payout (sum assured) if you pass away during the policy term. However, to maintain coverage, you must pay the monthly or yearly premiums to the insurance company on time. Read on to learn everything about term insurance benefits.
What are the Benefits of Buying a Term Insurance Plan?
Here are some of the few benefits of a term insurance plan you must know before choosing the right one.
1. Financial Protection
When you buy a term insurance plan, the insurance company will offer your family financial protection in case of your sudden demise. The insurance company ensures your family does not face any financial struggle when anything happens to you during the policy tenure.
2. Affordable Premium
Term insurance is one of the most affordable life insurance plans in India. It enables you to secure a large life coverage at an affordable premium rate. Moreover, buying a term plan at a younger age results in lower premiums.
3. Acts as Income Replacement
If you are the sole breadwinner of your family, your term insurance plan acts as an income replacement in case of your demise. The sum assured can help your loved ones maintain their standard of living, cover ongoing expenses, and meet financial obligations.
Unlike traditional term insurance, if you choose Return of Premium term insurance, it refunds all premiums paid if you outlive the policy term.
4. Offers Customisation Option
Another significant benefit of a term insurance plan is that it allows you to modify the insurance coverage, premium payments, tenure, etc., according to your needs. You can also add riders, such as accidental total permanent disabilities, critical illness and accidental death, and more, to the base term insurance plan to receive additional coverage.
5. Avail Tax Benefits
Another benefit of a term insurance plan is that it offers tax benefits under Section 80C and Section 80D of the Income Tax Act of 1961.
It enables you to claim tax deductions on the premium paid up to ₹1,50,000 per year under Section 80C of the Income Tax Act, 1961. Furthermore, you can claim tax deductions of up to Rs. 25,000 under Section 80D for premiums paid towards term insurance riders, such as critical illness cover.
6. Ease of Buying
Since several insurance companies offer term insurance plans online, you can easily buy one with just a few clicks from the comfort of your home at an affordable premium.
Conduct thorough research and compare the various plans available to choose the ideal term insurance plan according to your requirements. Furthermore, you can easily check insurers' reputations and reviews online for a hassle-free experience.
Final Words
Securing your family’s future financially is crucial. You can compare various term insurance plans online and check their benefits to choose the ideal one that fits your requirements. Having a term plan in place gives you peace of mind, knowing your family is financially protected in case of your sudden demise.
