Life is a journey filled with unexpected twists and turns, and it’s essential to be prepared for whatever comes your way. When it comes to financial security, there’s a beacon of hope that can shine even in the darkest of times – Term Insurance. To help you understand the many benefits of term insurance, let’s go on a journey with the story of Deepak.
Once upon a time, in the bustling city of Bangalore, there lived a man named Deepak. He was a hardworking individual who cherished every moment with his family. One evening, as he sat down with his wife, Sarita, he realised that he had been neglecting something crucial: securing their family’s financial future.
Deepak knew that life was unpredictable, and he wanted to ensure that his loved ones would be taken care of, even if something were to happen to him. That’s when he decided to explore the world of insurance, specifically term insurance.
Deepak began his quest to understand the benefits of term insurance. He met with an insurance advisor, Shagun, who explained the concept to him. Term insurance, she said, was a form of life insurance that provided coverage for a specified term, typically 10, 20, or 30 years. If the insured person passed away during the term, the policy would pay out a death benefit to the people named to get this benefit.
As Deepak delved deeper into his research, he discovered several compelling benefits of term insurance.
Benefits Of Term Insurance
1. Financial Protection
Term insurance is primarily designed to provide a lump sum payment (the death benefit) to your beneficiaries in case of your untimely demise. It can cover immediate expenses and provide long-term financial support. Unlike other types of policies, in Term insurance, one pays only for insurance and hence a lower premium. This leaves the user with the flexibility to invest anywhere. Money-back and endowment policies, on the other hand, have a dual purpose of insurance and savings. While they do offer some savings or investment benefits, they may not provide the same level of protection as term insurance, may earn lesser returns and are not very flexible.
Term insurance is one of the most cost-effective forms of life insurance. The premiums are low, making it quite accessible.
3. Time Period
Term insurance policies come in various term lengths, usually ranging from 5 to 30 years or more. This flexibility allows you to choose a term that aligns with your financial needs and responsibilities, such as paying off a mortgage, sending your children to college, or covering income loss until retirement. One can even add additional riders for critical illness or accidental death.
4. Peace of Mind
Term insurance offers peace of mind, knowing that your loved ones are protected financially if something were to happen to you. It can provide comfort and security during uncertain times.
5. Income Tax Benefits
Term insurance plans also provide tax benefits. While the premium you pay for a term insurance plan is tax-deductible. The death benefit paid out to the beneficiaries is not taxable.
6. Critical Illness Coverage
You may suffer from critical illnesses during any phase of life, and getting the necessary treatment can drain all your savings. If you have a family history of certain illnesses, you can choose to add on a critical illness cover to your term life insurance policy.
If you’ve been procrastinating on securing your family’s future, now is the time to consider term insurance. Just like Deepak, you can embark on a journey towards a brighter and more secure tomorrow. Remember, in the end, it’s not just about safeguarding your life; it’s about ensuring that your loved ones continue to live their lives with the same vigor and enthusiasm you’ve always known.
Don’t wait for life to surprise you. Take control of your financial destiny with term insurance, and let it be your beacon of hope in the most challenging times.
If you are confused, you can build a financial/investment plan with Propel Money, where we’ll tell you exactly how to deploy your savings.