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Save tax by good returns on investments with Term Insurance

Save tax by good returns on investments with Term Insurance

By obtaining term insurance, you can ensure your familys financial security in the absence of you. These days, term life insurance plans are one of the essential types of life insurance that a person should purchase. The most unfortunate events can be financially devastating to your family, and you could lose your house. Term insurance protects your family, as well as provides tax benefits. Additionally, you can take advantage of several other benefits when you buy a term plan. Let us check out a few of the benefits of term insurance plans: 1.) Simple to understand Some insurance terms about different life insurance policies can be difficult to understand when purchasing a life insurance policy. It is a defining characteristic of term insurance plans to be quite easy to understand. A term insurance policy does not include an investment component, as its a pure life insurance policy. The term insurance benefits are provided by an insurer who pays your premiums for a specific amount of time. 2.) Low Premiums and High Sum Assured Term life insurance is an easy way to purchase life insurance. The main advantage of this type of policy is the affordable cost. Term life insurance is affordable than other life insurance policies. Another benefit of buying term insurance early is that the premiums are lower. Online term insurance may also be less expensive than offline term insurance. Term insurance is one of the many benefits that will allow you to reap the cost-savings that happen on the insurers end. Term insurance benefits can even be checked online instantly. 3.) Maturity advantages In a conventional term life insurance policy, the only benefit offered is the benefit for mortality to the person who purchased the policy, and no benefits are offered on maturity. There are, however, certain plans nowadays, such as term return of premium (TROP) plans, which offer multiple maturities benefits paid as premiums to the policyholder if that person outlives the projects term. 4.) Benefits of income taxes Term insurance plans also provide tax benefits. In addition to the tax deductions associated with term insurance premiums, payouts may also qualify for tax exemptions under the existing tax laws. - Section 80C Term Insurance Benefits: Under Section 80C, you are tax-free on term insurance premiums up to Rs. 1.5 lakhs per year. To take full advantage of this section, you will need to buy the insurance plan with the maximum coverage that you are eligible for based on your age and health. - Section 10(10D) Benefits under Term Insurance: Section 10(10D) of the Income Tax Act 1961 provides that the death benefit of a term insurance plan is fully exempt from taxation. 5.) Accidental death benefit The insurance company provides an Accidental Mortality Benefit in case the insured person dies due to an unfortunate event resulting in their death. The family gets twice as much as they would receive if the insured person had died naturally. The is because, the insurance industry understands that a sudden unfortunate event can shuffle their entire lives. In the event that the victim survives the accident, the cost of medical treatment is also exorbitant. Therefore, they believe that a huge amount of money could ease the financial burden on the family. 6.) Coverage for Critical Illnesses Developing critical illnesses can occur at any time in ones life, and the treatment required can make all of your savings disappear. Although term insurance policies are primarily designed to provide life insurance, they do offer critical illness coverage when you opt for add-ons or riders. 7.) Death benefits in multiple forms Your EMIs could be for a new home, car, or you could be paying off a personal loan. When you are not present, your family may shoulder your financial obligations. Term insurance policies different payout options can be useful in this regard. On the event of your death, your dependents may receive a lump sum amount that will assist them with the aforementioned financial obligations. Along with death benefits, some term insurance policies also offer monthly payments as well as a lump sum. You may be able to manage your familys regular expenses easier with this monthly income. In choosing the most appropriate term plan from the choices currently available, you must consider the benefits each one provides. In addition to assessing your insurance needs, you should also determine which policy can benefit your family the most. Be sure to include your financial responsibilities as well. Additional riders can be added to the policy if you have more liabilities, and you can pick the most necessary coverage. You must be well versed in the details of the term insurance policy if you are going to purchase the best term plan. Disclaimer: This is a company press release. No HT journalist is involved in creation of this content. Download.

brand-post 2021-11-26 Livemint