The importance of buying term insurance coverage is now more crucial than ever, and the onset of the pandemic has clearly made it that much obvious. It would help if you started thinking about your family’s financial interests and signing up for value-added benefits like buying a life cover and customising it to suit your family’s needs. Financial planning has always been an important aspect of every earning individual’s life, and in today’s economic environment, it has become pertinent.
The best term insurance policy is your answer to managing your money well, investing in an instrument that not only offers life cover with some add-on covers for the policyholder but also financial independence to the family in their absence.
If you are not so great with managing your money, then a term insurance policy might be exactly what you need to help you invest your money in the right tool and enjoy manifold benefits. Here are all the reasons why the best term insurance policy is a perfect add-on to your financial planning:
1. Affordable Premiums
There are many who still can’t afford to look after all their monthly expenses, let alone keep money aside for insurance premiums. However, a term insurance plan is one of the cheapest insurance policies out there, with affordable premiums that can easily offer you a life cover into your seventies or eighties.
2. Quick Purchase
Everything is now easily available online in just a few clicks, and the best term insurance policy is also one amongst them. It is sometimes even more beneficial to buy a term insurance policy online after doing your due diligence and saving yourself a lot of hassle. You can use online insurance calculators to quickly run the numbers and understand how much premium will have to be paid to achieve the coverage you want.
3. Increased Life Cover
With every important life event, like marriage, the birth of a child etc., it is important to re-evaluate your finances and reconsider your cover. It is crucial that you make a term insurance comparison to know which insurance providers allow their policyholders to increase their life coverage as and when they hit important milestones in their lives.
4. Comprehensive Coverage
Apart from the life coverage that term insurance policies offer, you can also customise your plan to have certain health-related coverages as well. Again, there is a wide variety of riders to choose from, like critical illness cover, death benefit, waiver of premium, accidental death cover, etc.
This way, you do not even have to go out of your way to buy second insurance, i.e., health insurance, and pay much higher premiums, because these term insurance riders can be added to your existing policy for a nominal cost.
5. Secured Finances
The death of an earning member can put financial stress on the family, and if he or she was the sole breadwinner, then it gets even tougher. The best term insurance policy will be all you need to buy if you want to provide an income replacement for your family to take care of their expenses even in your absence.
You may have a lot of expenses as a family, some in the near term like credit card bills, home or car loan EMIs, etc., while some that you can see would come in the future like medical expenses during emergencies, children’s education and marriage expenses etc.
In your absence, it would be more difficult for your family to deal with a personal loss and manage all the current and upcoming expenses without you around to help them. A term insurance policy can offer the much-needed life cover to your loved ones and take care of their financial needs even on rainy days.
7. Income Tax Benefits
You can enjoy some of the best income tax benefits when you apply for a term insurance plan. Under section 80C of the Income Tax Act of 1961, you can claim a deduction every year of up to Rs. 1,50,000 against your term insurance premiums.
Additionally, the sum-assured, which is later paid to the beneficiary of the policy, is also tax-free as per section 10 (10D). Therefore, these income tax benefits can be enjoyed by the policyholder during the term of the policy, which is another major reason why term insurance is ideal in helping you plan your finances.
If you have taken all the measures to compare and cross-check benefits with your family, then buying the best term insurance policy could be the answer to all your money management issues. It will provide your family with the financial protection and independence they need, even when you are not around. Not only can you live a stress-free life with the best term insurance plan but also ensure that your family gets to live a debt-free tomorrow as well, as your life cover protects them all.