Five Reasons Why You Must Buy a Life Insurance Plan

As the uncertainties of life are increasing day by day, many families are realizing the necessity of adopting a life insurance plan. These plans give families extensive cover in case of unexpected eventualities. Life insurance providers are also coming up with new plans with additional benefits to meet the needs of different individuals. Irrespective of the plan one chooses, securing life is one of the best ways to attain future financial stability for the family. 

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Five Reason to Buy a Life Insurance Plan

A life insurance plan is the simplest of all existing policies, that render death benefits for the family in the event of the sudden demise of the insurer. Here are the top five benefits of life insurance plans:

1. Security for the Future

The Breadwinner of the family has many responsibilities such as children’s education, parent’s health, financial needs of the spouse, etc. Meeting with a sudden eventuality will prevent them from meeting these obligations. But by securing one’s life with the help of life insurance, they can provide for the children’s education and family’s financial needs after their death. The family can lead a comfortable life without any financial problems even after the death of the earning member.

2. Extensive Coverage with Low Premiums

The maturity benefits with life insurance plans are either absent or very limited and thus these plans render extensive coverage. The premiums of these plans are also very low compared with other insurance plans.

3. Creating of Wealth

Apart from rendering life cover, some insurance plans, such as unit-linked plans, help in wealth creation as well. These plans accumulate funds to meet the future financial goals of the insurer. The sum insured behaves like security to take loans from banks.

4. Many Add-Ons and Riders

Modern-day life insurance plans come with several additional benefits, known as riders and add-ons. Some of them are critical illness coverage, accidents coverage, etc. These riders are available at an additional cost but will help to maximize the benefits of the life cover.

5. Tax Benefits

Many people take life insurance plans as soon as they start working to achieve tax benefits. A policy taken under life insurance can help individuals to claim a maximum deduction of Rs. 1.5 Lakhs under section 80 C of the Income Tax Act (ITA). Also, any bonus or the sum received under life insurance policy is liable for tax exemption under section 10 D of the ITA. 

Bottom Line

The financial stability of the family is an important reason behind adopting a life insurance plan. The death of the earning member of the family can impair its functioning completely. Even managing day to day household expenses becomes difficult. But in the event of the death of an insured person, the agency will pay the complete sum assured, with which the rest of the family members can lead a comfortable life.

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