Understanding the reasons to invest in term insurance and its role in securing your family’s life.

Life’s short, fast, and unpredictable. You need to live your life and enjoy it while securing your family’s future. After all, isn’t that the primary reason to earn? To upgrade the standard of living, be able to take a break, and have days of solace during retirement. 

So, how can you plan your investments to secure your family’s life? 

Apart from all the investments that you make in equities, debt instruments, and saving schemes, one of the best ways to secure your family’s future is to avail of term insurance. 

So, what is term insurance? 

Term insurance is a type of life insurance providing coverage for a given duration to the insured. In the case of the sad demise of the insured, the nominees or the beneficiaries benefit from the financial benefits as per the sum assured. The sum assured assists the family in leading their lives in your absence without burdening them with the worry of managing finances. 

Why is term insurance so relevant? 

– It is beneficial for couples, parents, business people or self-employed individuals, SIP investors, young professionals, and even retired folks. 

– It allows you to claim tax benefits under Section 80C for premiums paid. Another tax benefit that insurers can pay is under section 10(10D) of the Income Tax Act of 1961. 

– It has lower premiums in comparison to the sum assured. This makes it affordable for many.

– The entry barrier to getting term insurance needs to be higher. You can be insured beginning at 18 years of age. 

– The tenure of the term insurance plan can range up to 40 years. This makes it possible for you to ensure that your family is insured for the longest possible duration. 

– The premium payment options are flexible. You can pay the premiums quarterly, monthly, or even annually. 

How buying term insurance can benefit you? 

– Enhanced peace of mind: As a breadwinner for your family, one of your concerns regarding your family’s future in your absence will be resolved. It allows you to focus on providing a better environment in the current day while securing their future. 

– Synchronises with retirement planning: Retiring is not just about stopping work. It takes a good amount of planning. Planning term insurance and retirement planning gives you better control over both. 

– Benefits against liability: The sum assured of your term insurance plan can be used to protect your family against debt liabilities like loan repayment. 

Key points to consider: 

– Coverage amount: Choose a coverage amount based on your expenses and obligations. A rule of thumb is 10 times your average annual income. 

– Policy term: Choose this based on your family’s needs and dependencies. 

– Riders for additional coverage: Riders like critical illness benefits or accidental benefits can make a difference. 

Apart from the above-mentioned points, do read the policy-related points so that you have better knowledge that allows you to make better decisions. Secure your family’s future with term insurance.