Most life insurance plans cover major eventualities that lead to loss of income of the policyholder. A term plan will help your family in meeting their financial requirements even when you are not around. This Insurer will pay the sum assured of your Policy to your nominee after your death. A critical illness plan, provides sum assured when you are bedridden with a critical illness. Life insurance is also one of the essential elements that you can have in your savings and investment portfolio. When it comes to savings, there are plans that provide guaranteed returns and also provide a life cover.
Here are some important reasons as to why you should buy life insurance:
• Family’s Financial Security comes first:
If you are the only bread winner of the family, then the family’s income will cease in your absence. Lacking steady source of income, the standard of living of your family may fall and they may not be able to meet basic needs like education, daily expenses, etc. Therefore, a term insurance plan will help your family cope up with financial distress during such phases of life.
• Payment of EMIs and loans can be a challenge
You may have taken a house loan, car loan, business loan or personal loan. If you have young kids who are still studying or not yet settled, it will be your spouse who will have to bear the heavy burden of paying off these EMIs while also managing your child’s education and other daily expenses. This may lead to your family compromising on their standard of living or again borrowing money to pay off these debts. You can prevent your family from financial distress by buying a term insurance plan.
• Terminal Illnesses are expensive
Critical illness plans cover major critical illnesses like cancer, heart disease, chronic kidney disease, etc. A critical illness plan provides a lump sum amount on the diagnosis of a critical illness that has been predefined in the policy document. This plan helps you cope up with major expenses that can occur if the policy holder is detected with a critical illness.
With the lump sum amount you can get treatment from the best hospitals without worrying about the financial burden. Ideally, all insurance policies should be purchased when you are young and free of illnesses. This helps in your policy getting issued and also reduces your premium rates.
- Protection against major accidents: Life is uncertain and so are accidents. Your cars and bikes are insured but what about you? There are riders that can be attached to your policy which provides financial security in case any major accident occurs. The rider covers any permanent disability that can be caused due to an accident.
- Saving Taxes
Life insurance policies are a good way of saving tax too. Under Section 80C, many life insurance schemes offer tax deductions on premium payments.
• Diverse Investment Options
With various options provided by insurance companies, insurance policies are also attractive investment options. From childhood to old age, there are various plans for everyone as per their needs. For example, retirement plans, child insurance plans, savings plan, ULIPs, etc. are all provided by life insurance companies. One has to identify his/her needs and then opt for a plan which fulfils the needs.