Life insurance is a contract between an insurance policy buyer and insurer. Insurance companies promise to give financial protection to the policyholder’s family upon his death. The full sum assured will be given to the customer by the insurer after maturity.
Who should buy life insurance?
When we plan or think about investing in life insurance, the only one question comes to mind – who should buy life insurance? It is completely dependent on the financial situation of the investor and how many people are dependent on him. Financial dependents might be children, a spouse, or even dependent parents. other people who buy life insurance are those investors who want tax savings.
Some reasons of buying Life Insurance.
- Life Insurance is a risk cover: Life Insurance is about risk cover and protection; It Protects the policyholder’s family during unpredictable life losses. If you’re the head of your family then life insurance can help to secure the future of your family by providing financial benefits.
- Saving: life insurance offers an opportunity to the individual to save and deposit a fund for the future. Life Insurance can help an individual to invest in a systematic and disciplined way that’s how they can achieve the long-term and short-term financial needs of life.
- Tax Savings: Life insurance is also one of the many tax-saving investment options available to investors. The premium paid by you as per the provisions of Section 80C is deducted from your total taxable income to Rs 1.5 lakhs. Apart from this deduction, the maturity or death benefits available under the insurance scheme are also tax-free as per section 10.
Types of Life Insurance
- Term Insurance: In term insurance, an individual buys a policy for a fixed period of time such as 10,20,30 years. In term insurance, an individual buys a policy for a fixed period of time such as 10,20,30 years. This policy does not have any maturity benefits, it is bought only for protection purposes, which means it is not a saving plan. It should be bought when we start our professional life. Some Term Insurance are available with return of premium after maturity.
- Endowment Plan: Only the endowment plan covers risk benefits as well as maturity benefits and this makes it different from term insurance. After maturity a policy holder will receive the total amount of S.A with interest.
- Money Back Policy: This policy is similar to endowment policy; the only difference is that this policy provides many survival benefits which are allotted proportionately over the period of the policy term.
- Whole Life Policy: It is also known as Permanent Insurance Policy; it is a type of insurance that gives lifetime coverage. Premiums are higher as compared to term insurance policies. A lifetime insurance policy also has some well-known characteristics of cash receipts that act as a tool for investment. Here, after a certain period under your policy, you will be able to withdraw the money deposited as premium. However, this money needs to be credited back otherwise the death benefit of your policy is greatly reduced. Therefore, in short, permanent insurance provides you financial support as well as life protection.
If you are planning to buy Life Insurance from us call us the number given below or fill the form.