A term insurance plan is a life insurance product that provides financial coverage to the policyholder for a specified period. In the event of the sudden death of the insured, the full amount is paid to the members of his family. A term insurance plan provides stable financial coverage for your loved ones in the event of an incident.
Benefits of subscribing to a term insurance plan
Before you start buying a term life insurance plan, you should know the benefits of investing in a term life insurance plan.
We have put together a detailed list of benefits. Read carefully to find out how to better plan for your family’s financial future.
- Greater life coverage
A term life insurance plan gives you broader life insurance coverage at a higher premium. It’s better than a staffing plan. For example, a 30 year old can get a 1 crore term plan by paying a premium over 30 years. In the case of a staffing plan, it will not suit a 30-something.
- Large sum insured at an affordable price
The main advantage of buying a term insurance plan is that it is affordable. Compared to other life insurance plans, a term insurance plan is much more economical. Another advantage of a term insurance plan is that the earlier you invest in a term insurance plan, the lower the premium you will pay.
Buying a term insurance plan online is better than buying offline because it saves you the cost of the premium.
- Increase life coverage
There are times in an individual’s life when they need funds for their child’s education or marriage. The best thing about a term insurance plan is that it allows you to increase life coverage at crucial stages in the policyholder’s life, such as when they get married or when they become a parent. .
- Easier to understand
The second benefit of buying a term insurance plan is that it is easier to understand. A term insurance plan does not have an investment component, nor is there any difficult jargon associated with the term plan.
- Several payment options at death
If you are inundated with paying IMEs for your new home or car and struggling to manage new policies, then going for a term life insurance plan is a great option. In the event of the sudden death of the policyholder, family members tend to be financially overburdened. To avoid such a difficult situation, you can benefit from a term insurance plan as it allows you to get a lump sum or monthly / quarterly / yearly payments. This, in turn, can help keep your family going in a much better way.
- Additional runners
The best thing about a term insurance plan is that a policyholder can add additional endorsements to the plan. By adding endorsements such as waiver of premiums, critical illness or disability, you can increase term insurance coverage. This is useful in cases where a family member is diagnosed with a critical illness. So instead of digging a hole in your savings, you can use the term insurance plan and pay the medical bills.
If you want to forfeit your premium, you can get all premiums back with a term premium refund plan. It works in a situation where you outlive your term insurance plan.
- Covers serious illnesses
If you know what health insurance is and you are covered against medical bills, you might be wondering what the need for critical illness coverage is? However, serious illnesses can seriously affect your financial health. Therefore, investing in a term insurance plan works well when medical issues unexpectedly knock on your door. To avoid the stress of paying sky-high medical bills, you should get a term plan that includes serious illness such as cardiovascular disease, cancer, and other serious conditions.
- Covers accidents
If you compare a life insurance plan to a term insurance plan, the benefits of term plans are huge. In the event of an unfortunate accident or accidental death of the insured, his family will be protected from the financial overload of medical treatment. Adding an accidental death benefit to your temporary plan can increase your coverage and prepare you for an unforeseen situation.
- Includes premium refund
A term insurance plan only benefits an insured in the event of death. However, you can benefit from the reimbursement of premiums from a term insurance plan if you wish to benefit from the early maturing benefits of the plan.
In this case, you will have to pay a higher premium, and when the term plan expires, you will get the lump sum. You will get the full amount if you survive the term of the policy.
- Fiscal advantages
Buying a term insurance plan allows you to benefit from tax advantages. This, in turn, means that you can reduce your tax obligations by investing in a term plan. Under Section 80 C of the Income Tax Act, 1961, the policyholder can reduce the term plan by Rs 1.5 lakh per year. The payment, however, is exempt under Section 10 (10D) of the tax laws.