Some Things You Need To Know About Life Insurance
Life insurance is an
important financial tool that could benefit you at many different stages in
your life. A Life Insurance plan ensures that your family is financially secure
even if tomorrow you are no longer around to care for them. Life insurance is a unique investment that helps you
to meet your dual needs - saving for life's important goals, and protecting
your assets against risk . Life insurance provides money typically to
beneficiaries after a loved-one who has life insurance dies.
Advantages of Life Insurance are enumerated
below…
Life Insurance provides risk cover
Life today is full of
uncertainties and in this scenario Life Insurance ensures that your loved ones
continue to enjoy a good quality of life against any unforeseen event like your
absence if you are the person on whom everybody depends..
Life Insurance is planning for life stage needs
Life Insurance not only
provides for financial support in the event of untimely death but also acts as
a long term investment. You can meet your goals, be it your children's
education, their marriage, building your dream home or planning a relaxed
retired life, according to your life stage and risk appetite. All the traditional
life insurance policies i.e. traditional endowment plans, offer in-built
guarantees and defined maturity benefits through variety of product options
such as Money Back, Guaranteed Cash Values, Guaranteed Maturity Values.
Life Insurance is protection against rising health expenses
Life Insurers through
riders or stand alone health insurance plans offer the benefits of protection
against critical diseases, accidental benefits and hospitalization expenses.
This benefit has assumed critical importance given the increasing incidence of
lifestyle diseases and escalating medical costs.
Life Insurance builds the habit of thrift
Life Insurance is a
long-term contract where as policy holder, you have to pay a fixed amount at a
defined periodicity. This builds the habit of long-term savings. Regular savings
over a long period ensures that a decent corpus is built to meet financial
needs at various life stages.
Life Insurance is safe and profitable long-term investment
Life Insurance is a
highly regulated sector. The regulatory
bodies, through various rules and regulations
ensures that the safety of the policyholder's money is the primary
responsibility of all stakeholders. Life Insurance being a long-term savings instrument, also ensures that the life insurers focus on returns over a
long-term and do not take risky investment decisions for short term gains.
Life Insurance is best for retirement planning
Life Insurance is one of
the best instruments for retirement planning. The money saved during the
earning life span is utilized to provide a steady source of income during the
retired phase of life.
Life insurance gives protection plus savings over a long term
Since traditional
policies are viewed both by the distributors as well as the customers as a long
term commitment; these policies help the policyholders meet the dual need of
protection and long term wealth creation efficiently. Traditional policies
offer an opportunity to participate in the economic growth of the country
without taking the investment risk. The investment income is distributed among
the policyholders through annual announcement of dividends/bonus.
Life Insurance provides facility of loans without affecting the
policy benefits
Policyholders have the
option of taking loan against the policy. This helps you meet your sudden, unplanned
life stage needs without adversely affecting the benefits of the policy they
have bought.
Life Insurance is eligible for tax benefits
Insurance plans provide
attractive tax-benefits for both at the time of entry and exit under most of
the plans.
Life insurance is a tool for mortgage redemption
Insurance acts as an
effective tool to cover mortgages and loans taken by the policyholders so that,
in case of any unforeseen event, the burden of repayment does not fall on the affected family.
In this way, life insurance offers several advantages
not available from any other financial instrument.
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