A life insurance policy is more than just a tax-saving tool or a portfolio-worthy addition in today’s times. The past year especially has shown us how bad times can get and how valuable every life is.
More and more earning individuals are switching towards finding a safer and financially secure way of looking after their family even in their absence. Therefore, investing in a life insurance policy comes into play, and the year 2021 is definitely the year to start with one.
With the help of a life insurance policy, you can support your family financially and ensure that they do not get burdened with expenditure or lose out on their independence. If you are thinking about buying life insurance, then make it a point to run the numbers and calculate your premium using the insurance premium calculator online.
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There are many types of insurance plan providers in the market, and it could be quite difficult to pick the one that would suit you best. However, rest assured that you can get in touch with an advisor who can help you pick the right plan, choose additional riders, and calculate your premium using the life insurance premium calculator.
Once all your due diligence and comparison is in place, you can go ahead and pick the policy that fits perfectly with your financial plans and family needs.
Why Do You Need To Buy A Life Insurance Cover In 2021?
In the wake of the current pandemic, earning individuals all over the world are realizing the importance of investing in the financial security of their family, in the future. However, if you want to know exactly how this could benefit your family in your absence, then here are some of the many reasons why a Life Insurance cover needs to be your priority in 2021:
1. Life Risk Cover
Life insurance provides you with a high life risk cover that can look after your family financially, in your absence. You no longer have to worry about saving for your family and factoring in the inflation as the lump sum from your life insurance policy will do it for you instead.
2. Death Benefits
In case of any untoward happening to the insured, the insurer pays the entire sum assured of the insured’s life insurance policy plus the bonus to the bereaved family members. This would be easing to the mind, knowing that your family has a financial net to fall back on.
3. Assured Income Benefit
With this policy, you can receive assured income at regular intervals, ensuring that your family stays secure even in tough times. It is ideal for families who do not wish to receive a lump sum from the get-go and would opt for monthly payouts that are steady and help them stay afloat as well.
This income can also replace the income that discontinued after the loss of the breadwinner, ensuring that the family is still financially independent and managing their bills and expenses by themselves.
4. Retirement Planning
You can also avail of annuity-based life insurance plans that offer monthly pensions to the policyholder when they mature, and this could easily help you plan a secure retirement. While this may not be the top investment in your retirement portfolio, a life insurance policy could surely help to balance out your portfolio and mitigate some of the risks as well.
5. Tax Benefits
One of the most effective ways for a salaried person to reduce tax liability is with the help of Section 10(10D) of the 1961 Income Tax Act.
At present, the old tax regime allows a deduction of up to Rs. 1,50,000 (total of all investments and payments present in this section), including premiums paid for a life insurance policy, provided that the yearly premiums do not exceed 10% of the sum assured to the policyholder. Hence, remember to use an insurance premium calculator to run these numbers in advance.
When you decide to secure yourself and your family with a life insurance policy, remember to do your due diligence and explore options from reputable insurance providers with a high claim settlement ratio. Doing so would ensure no issues with claim processing, and you can be assured of no hassles.
Besides, leading insurance providers also have products that are designed to fulfil a wide range of prospects, as they tailor their insurance plans to the requirements of the consumers. So, go ahead, take that first step towards securing your family in your absence and providing them with the much-needed financial net, starting today!