Gone are the days when people did not worry about expenses or think that insurance policies are not a necessity unless they want to simply save some amount during tax filing. However, in today’s testing times, it is evident that a life insurance plan is the need of the hour, and the ongoing coronavirus pandemic has only made it more necessary than just a tax-saving tool.
Not only are people understanding the importance of living a healthy lifestyle, but they are also leaning towards securing their family’s financial wellbeing by opting for term insurance, which pays out the sum assured to the policyholder’s family/beneficiaries if the insurer dies during the policy term.
Gifting your loved ones, a stress-free life is possible if you make plans for securing their future early and make savings a habit. Here are a few points that one must consider before buying term insurance:
- Know The Coverage Amount
The main purpose of the term insurance plan’s coverage amount is to financially secure the family of the policyholder in their absence. Therefore, it is important for the policyholder to know how much of their financial contribution is needed by their family to run smoothly even in their absence.
However, if you are the sole breadwinner of your family, then it is all the more vital to have a larger coverage amount as your family will have an exhaustive number of bills and expenses to handle in your absence. Making it easy for your family to survive and not be financially burdened is all up to you and the decisions you make while customising your term insurance plans.
- Analyse Your Present And Future Financial Liabilities
Right from your home loan or car loan EMIs to saving for a wedding and from providing education to your children’s to investing for their marriage, many types of expenses can come in the way of your savings.
Paying off credit card bills and putting money aside for your daily or monthly expenditures is crucial to any financial plan. Keep a tab of all your near and future potential expenses to understand exactly how much coverage your family will need from a term insurance policy.
- Compare Term Insurance Policies
Get quotes from leading insurance companies and compare the term insurance plans of different insurers to get the most of term insurance benefits. An ideal way to choose the best term insurance policy is by comparing how high of a claim settlement ratio can a particular insurer guarantee because that ensures that your policy’s claim process will be stress-free for your family.
- Check Out The Riders Offered With Term Insurance
It is vital to look for the additional riders that various insurance providers offer with the term insurance plan so that it can help you narrow down your decision. From accidental benefit to partial or complete disability and from waiver of premium to opting for a survival benefit term plan, you will have many options to pick from.
Remember to customise your term insurance plan to keep your needs in mind and anticipate your family’s needs in the future because an additional rider can make your policy solid.
- Stay Updated With The Tax Benefits
With the help of a term insurance policy, you can save up to Rs. 1,50,000 against the premium paid on a yearly basis. The old tax regime offers you this tax deduction for the premiums to pay towards your term insurance or also for the premiums paid towards the term insurance of a dependent parent.
Moreover, the lump sum benefit that is paid under section 10 (10D) of the Income Tax Act of 1961 is also tax-exempted.
Bottom Line- Opt For A Wholesome Term Insurance Policy
There are many term insurance plans that policyholders can choose from and customise to suit their and their family’s needs, and many insurance providers offer top-notch plans. One such well-known name is Max Life Insurance, which offers a wide variety of plans, with several attractive features to help secure your health and finances for the future. So, take charge of securing your present and your family’s future in your absence and get holistic term insurance today.
