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Everything You Need To Know About Term insurance Plan

Published On Sep 05, 2021

A term insurance policy is a type of life insurance plan that offers coverage to the policyholder’s family in the event of unforeseen demise for a specific period. This insurance plan does not just offer high coverage at low premium but also provides various other benefits to the customers in India.

Who Can Buy a Term Insurance Plan?

A term insurance plan can be bought by any person who has family members depending financially on him/her for their sustenance. A person who is aged between 18-65 to 69 years old is eligible to purchase a term insurance plan in order to secure their family in case of any unforeseen events.

Why Should One Buy a Term Insurance Plan?

Most of the individuals believe term insurance as an investment, however, that is not true at all. The main objective of buying a term insurance plan must not be as a source of investment but to be able to offer support to your family in the event of uncertainties. The sum assured that your dependents would receive can be utilized to lessen their financial hardships post your untimely death.

Also read - When to Purchase a Term Insurance Plan?

Advantages of Buying a Term Insurance Plan

Here are some of the advantages of having a term insurance plan:

1. Affordable: A term insurance plan is one of the most affordable types of life insurance plan. Under this plan, a policyholder can get higher coverage at a reasonable premium amount. When compared to permanent insurance plans that provide guaranteed returns, a term insurance plan makes sure that you get a significantly huge amount of sum assured at a relatively lower premium.

2. Flexible Periods: There are several insurance companies in the market offering different insurance plans, wherein you can choose policies beginning from a year up to 30 or more years. You can opt for an insurance plan either long term or short term as per your financial requirements.

3. Higher Coverage: The best thing about a term insurance plan is that you are not required to invest a huge sum of money on a monthly basis in order to avail overall coverage. Therefore, not only are these insurance plans economical but they also offer higher coverage with added benefits for the financial security of your family.

4. Tax Benefits: Many people do not know that a term insurance plan offers various tax benefits too. A term insurance plan offers tax deduction as per section 80C, Section 80D and section 10D of the Income Tax Act.

At the End

A term insurance plan is one of the most efficient ways to protect the future of your family members financially in the event of your untimely demise but at the same time it also provides several tax benefits, hence making it one of the most sought-after tax saving tools. It is important to have a complete understanding of a term plan before buying one in order to make the most out of it.

You may also like to read - When To Terminate Life Insurance Plans?

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.

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