When it comes to the safety of life, life insurance plans fit right into the picture. Life insurance plans cover the risk of premature death. They provide a financial benefit to the family after the life-insured passes away. Life insurance plans can help you secure your life, financially. Let’s understand how.
What is life insurance?
Life insurance is a form of insurance that covers the risk of dying early. If an individual buys a life insurance policy and then dies during the coverage duration, the policy promises to pay a financial benefit to the aggrieved family. This benefit can help the family deal with the financial loss that they might have suffered due to the individual’s sudden demise.
How can life insurance secure your life?
A life insurance plan can secure your life in the following ways –
- Creating a corpus for emergencies
Emergencies come unannounced. When they strike, most often than not you need a financial corpus to deal with the hardships.
One such emergency is premature death. Death, though inevitable, can cause a financial loss if it strikes prematurely. If the breadwinner of the family passes away before his time, the family suffers a major financial loss. To deal with such a loss, a life insurance plan becomes necessary.
You cannot predict death. However, with life insurance, you can make a provision for unforeseen eventualities that might land your family in financial trouble. You can use the life insurance calculator and choose the right sum assured which creates the desired corpus for emergencies.
- Different plans for different goals
There are different types of life insurance policies. Each of these plans can help you plan for the different financial goals that you might have. For instance,Â
- If you want to secure your family’s future in your absence, a term plan can do the needful.
- To plan for your child’s future financial needs, child insurance plans come to the rescue.
- For retirement planning, pension plans can prove to be the right choice.
- For buying a home, or a car or for any other financial goal, ULIPs, endowment plans or money-back plans are suitable choices.
Thus, with the range of life insurance plans available in the market, you can plan your future goals and also ensure that they are fulfilled.
- Flexible coverage
Life insurance plans allow you the flexibility to choose the coverage level, duration, premium paying term and frequency and also any optional riders that you might need. These choices allow you to customize the insurance plan per your financial goals and investment needs so that they fulfil their objective.
- Peace of mind
With the financial security promised in the case of premature death, life insurance plans give you peace of mind. They ensure the financial security of your family in your absence and ease your financial worries to a great extent.
- Tax benefits
While tax benefits do not contribute to security, they are additional benefits that lower your tax liability and help you save more. As you save more, you can invest more, thereby moving one step closer to financial security. So, effectively, the tax benefits of life insurance plans add brownie points to their usefulness and make them a good addition to your financial portfolio.
Life insurance plans also help the family repay any outstanding debt if the life insured dies leaving them behind. With the compensation received from a life insurance policy, the family can get rid of the debt burden and be financially free.
So, life insurance plans have a lot of benefits, financial security being the primary of them. You need to think about your family’s safety and security and then opt for a suitable life insurance policy that safeguards your family’s finances and gives them security against unforeseen emergencies. So, assess your coverage needs with a life insurance calculator and invest in a suitable plan today!
