Is Life Insurance meant only for the elite? Do Life Insurance Policies intimidate you? Isn’t Life Insurance Premium expensive? Life Insurance as a concept is surrounded by stereotypes, myths, and speculation. It is one of the most important financial decisions of an individual’s life. They are easy to understand and even easier to purchase.
Irrespective of our income levels, the future treats everyone equally with its uncertainty. Securing your family’s future is a universal as well as a logical concern. Life insurance policy information need not be daunting.
In simple terms, you buy the best life insurance policy, pay a stipulated premium amount and when you pass away the amount is transferred to your beneficiary or beneficiaries, as the case may be.
Types of Life Insurance Policies
These are the basic types of insurance policies:
1. Term Life Policies
These policies provide coverage for a specific period. It usually lasts for a year. You can renew this policy based on your health. The premium highly depends on the quality of your health. If your health deteriorates, your premium price will be higher.
2. Cash-Value Life Policies
Cash value life insurance policies accumulate value during the policyholder’s life. The repayment is made upon the policyholder’s death. These types of insurance policies usually have a higher premium than other term policies.
Steps To Make Sure Your Family Is Financially Supported
Your concern to support your family financially comes from a sweet spot of love for your family. Your concern need not take the route ruled by worries. Follow these simple steps and make sure your family is financially protected:
- Define what financial security means to you: Financial Security holds a different meaning for different people. Ask yourself the following questions to put a financial plan in place:
- For how long and how much income would you like to provide your family with, in case of your premature death?
- Define the level of income that according to you would help your spouse get a job or transition between jobs.
- How do you plan to pay for your kid’s college fees?
- Do you plan on providing for half the fees and having them pay the rest?
Once you have answered these questions, you can choose a financial plan.
1. Look At The Entire Financial Landscape
There is more to a financial plan than life insurance. Map out various aspects of financial security including retirement benefits, investments, and financial assets, if any. This exercise will help you understand if there are any shortfalls in your numbers. This can be efficiently funded with Life Insurance.
2. Get An Expert On Board
There are different types of life insurance policies. An Insurance Agent will help you out with two major aspects of insurance policy. First of all, he will map out what you need, and second of all; he will help you decide the best policy for life insurance based on the circumstances.
3. Get Yourself Acquainted With Different Types Of Insurance Policies
Know about the types of policies that are present. This will help you make a better choice. You can match your requirements with the best policy of life insurance in India.
Define your needs for a life insurance plan. These steps will enable you to make an informed decision.
Top Reasons Why You Need To Purchase Life Insurance Policy
It’s a myth that young people don’t need insurance and it’s a headache for when they get older. Various benefits tag along over your lifetime. Don’t overlook these benefits when it comes to investing in life insurance policies at a young age.
Here are a few undeniable reasons why you need to purchase a life insurance policy:
- You don’t want your family to deal with your debts. If you buy the right insurance policy loans, debts for credit cards and personal loans will be taken care of.
- It diversifies your investment options and helps you achieve long-term
- It is a fact that insurance policies are cheaper when you are younger. The coverage costs are gradually lower when you are younger.
- Various Insurance policies help your business too. You can invest in life- insurance and term insurance policies. In case, of your premature death, your partner can sell or buy your portion with ease.
- You could save taxes with insurance policies. The insurance premium you pay on a policy is eligible for a maximum deduction of Rs 1.5 lakh under Section 80C of the Income Tax Act, 1961, and for tax-free proceeds on death or maturity under Section 10 (D).
Life Insurance proves to be an effective tool for policyholders to save and protect the financial future of their family. Invest in the right insurance policy for the family you love.
