What life insurance covers, how it works, tax benefits, types, riders, plans without medical, and why it\’s important for Indian families.
Life insurance is such a financial product that keeps your family financially secure even after you are gone. Today we will understand in simple language what life insurance covers and what are its benefits. We will also know how a life insurance policy works and how to choose the best plan for yourself.
What does life insurance cover?
The basic purpose of life insurance is to provide financial support to the family after the death. If the policyholder dies during the policy period, the insurance company pays a lump sum amount to the nominee.
This amount covers the family below needs :
Household expenses (daily needs)
Children\’s education (Very Expensive)
Marriage expenses ( big liability)
Loans repayment (like life insurance to cover mortgage)
Future security for spouse or parents
If you have life insurance with return of premium ,(Term Plans are available with thus benefit) and you survive till the policy term, you get your full premium return.
How Life Insurance Policy Works?
Different Life Insurance Plans:
Many types of life insurance plans are available in India:
1. Term Life Insurance: Most affordable plan. Only death benefit is available. Best for high coverage in low premium. (Life insurance term plan)
2. Whole Life Insurance: Lifelong coverage is available.
3. Endowment Plans: Maturity benefit is also available.
4. ULIPs: Investment is also done along with insurance.
Life Insurance Without Medical Test
Now a days you can get life insurance without medical or life insurance without medical check up. These plans usually have low sum assured and are for short term. But if you want to get a life insurance without medical test, the company takes a decision on the basis of your age, lifestyle and existing health conditions.
Life Insurance Riders – Extra Protection
You can also add some riders with your policy:
Accidental death benefit
Critical illness rider
Waiver of premium
Payor waiver benefit
Disability rider
These life insurance riders give you extra security in a small additional premium.
Life Insurance Tax Benefits
You also get the benefit of income tax on the premium of life insurance policy. Under Section 80C, you can take a deduction of up to ₹1.5 lakh annually. And the amount you get on maturity or death claim is also tax-free under Section 10(10D). So, do not ignore life insurance tax benefits.
Why Life Insurance Is Important?
Gives financial protection to your family
For all these reasons, the answer to why life insurance is important is simple – a financial safety net for your loved ones!
How to get Life Insurance in India?
Today, there are many trusted life insurance companies available in India like LIC, HDFC Life, ICICI Prudential, SBI Life etc. You can compare life insurance quotes and choose the best plan.
If you are confused, you can search for a nearby life insurance office and get consultation.
You can also consider government life insurance plans like PMJJBY (Pradhan Mantri Jeevan Jyoti Bima Yojana) – which gives coverage of ₹2 lakh in just ₹330 yearly premium. This life insurance comes under the government.
Conclusion:
Whether you are a working professional, a business person or a homemaker – life insurance is important for everyone in India. In this way you are giving your loved ones a financial gift which comes in handy in their difficult times.
So select a plan according to your needs today, check the life insurance premium, and secure your dreams.
What is your experience with life insurance? Tell us in the comments below and if you have any questions, don\’t forget to ask!
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