The COVID-19 situation has affected the lives and careers of many people, and the future seems quite uncertain. If you have been worrying about your life and your loved ones’ security, a life insurance policy can offer you peace of mind. You can use a life insurance calculator to compare different policies and buy the one that you find most suitable.
What is a life insurance policy?
A life insurance plan is a financial cover that your loved ones get when you are not with them due to an unfortunate event. When you buy a life policy, the insurance company agrees to pay a lump sum to the nominees in exchange for a specific number of premium payments. There are different life policies, offering a variety of benefits like a financial cover and fund buildup.
Importance of life insurance while securing your future
As you get older, your life goals change. During the early phase of life, you are single and worry-free; however, with time, your family starts to grow, as you get married and have children. Then, in a few decades, you will retire from your job, and your life will change completely. During these different periods, your financial targets also change.
This is why you must take every measure possible to ensure that neither you nor your family ever has to worry about money. Life insurance plans can help with this. For one thing, it takes care of your family’s monetary needs in your absence. Secondly, you can even build wealth for the future with specific life policies like a Unit-Linked Insurance Plan (ULIP).
Various benefits offered by life insurance plans
These insurance policies have many life-enhancing benefits. Read on to learn about the most important ones:
- Provides security for the future
This is the primary goal of a life policy. It offers financial stability to your loved ones when you cannot be there with them. The insurance company gives the sum assured to your family, which protects their needs. A term life insurance is the best policy to provide financial cover to your loved ones, cost-effectively.
- Takes care of the liabilities
One of the biggest challenges any family faces in the absence of its primary earner is financial liabilities. You do not want your family to struggle due to an unpaid home loan. The benefit received from the life policy can take care of it.
- Helps to save inthe long run
Life policies are great tools for saving money. Some plans give you the facility to save your hard-earned money along with the sum assured. Hence, you can buy such a policy to secure your family’s future needs and build a fortune to fulfill critical financial goals.
- Assures peace of mind
This is one benefit of a life insurance policy that most people do not consider. It is normal to worry about the future, especially in these trying times. Life policies ensure that your family will remain financially safe, even if you cannot be there. Thus, with such a plan, you may lead a stress-free and peaceful life.
- Facilitates retirement planning
During your golden years, you must focus on having a wonderful time with your dear ones and not worry about money. A ULIP can be helpful in such a scenario. It is a type of life insurance policy that invests a portion of your premium into instruments, such as debt funds and equity funds, depending on your risk-taking capability. Hence, along with the sum assured in case of an untoward incident, a ULIP also helps you build a huge retirement fund.
- Offers tax benefits
A life insurance policy also comes with certain tax advantages. Under section 80C of the Income Tax Act, 1961, you can claim a deduction of up to INR 1.5 lakh per year for the premium paid towards the life policy. This benefit helps you save more.
These features of life insurance make it an excellent tool for securing your family’s future and helping you live without any worries.