Can You Afford Not Having a Term Insurance Plan?
Updated On Aug 15, 2021
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Term life insurance plan offers coverage to the policyholder against life risk’s. These are insurance plans that offer high life coverage at lower premium rates. To state simply, when the policyholder dies during the policy term, the death benefit is paid to the nominee in lump sum or in installments for a specific time period.
Term Insurance Plan Benefits
Here are some of the benefits of a term insurance plan mentioned below:
Helpful in Meeting Expenses
In the absence of a regular source of income, it may become difficult for your family to meet their everyday expenses. However, with the insurance amount received, they can easily manage their day to day expenses such as medical treatment, electricity bills, food and other similar expenses.
Helps in Meeting Financial Liabilities
The demise of the sole bread earner of the family can come forward as a shock both emotionally and financially. However, with a term insurance plan, the family members can cope up peacefully with the debts and other liabilities like marriage, child’s education, elderly parents, loans, etc. It would offer them financial safety against any uncertain event.
A term insurance plan not just offers protection to your family members, but with a term insurance plan, you can easily avail tax benefits on your current income. A policyholder is entitled to receive tax deduction up to Rs 1.5 Lakh on the payable premium as per section 80C of the Income Tax Act.
Tax Free Payouts for Dependents
In case of your demise, your family would receive the entire sum assured amount without any deductions. Although, you do not possess any control over death matters yet you can protect your family members from any type of financial crisis with a term insurance plan.
What Happens When You Skip Buying a Term Insurance Plan?
You may have to deal with the following repercussions in case you choose not to purchase a term insurance plan:
With the unforeseen death of the sole breadwinner of the family, it gets hard for the dependents to sustain their living. One cannot imagine their life without any basic amenities i.e. shelter, food and clothing. This is when term insurance comes to your aid during difficult times.
Home Loan Debt
You have purchased your dream house from your savings and hard earned money. However, due to your unexpected death, it may become difficult for your family to pay the EMI’s of the home loan. Not getting yourself insured under a term insurance plan, especially when you have financial liabilities to pay off, would make it hard for your family to meet your debts after your demise.
Loss of Regular Income
In case your family is entirely dependent upon you, imagine how difficult it would get for them to meet the expenses for their day to day living. Moreover, if you are having younger siblings or looking after someone’s education, parent’s old age, etc, then facing the financial crunches would be a huge task for the dependents.
No Peace of Mind
The family would not only have to cpe up with the emotional loss of losing a loved one but would also have to face a financial crisis arising due to meeting daily expenses unwillingly. Such a situation could definitely land your family members in a big mess.
In a Nutshell
In case you are having family members who are completely dependent upon you financially, then purchasing a term insurance plan can prove to be one of the smartest investments made by you. Thus, if you still haven’t bought a term plan till now, then hurry up.
Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.