Discover The Benefits Of Term Insurance Policy In India

Published on 02-May-2023

Term insurance is a form of life insurance that offers protection for a set duration, typically referred to as the term. During this time, the policyholder pays premiums in exchange for coverage. It is one of the most popular forms of life insurance in India due to its affordability and simplicity.

Benefits of Term Insurnace Policy

Affordable Premiums
One of the most significant advantages of term insurance is its affordability. These insurance policies have lower premiums compared to other types of life insurance policies, making them an ideal option for those on a tight budget.
With this insurance policy, you can get adequate coverage at a low cost, which means you can protect your family's financial future without breaking the bank.

High Coverage Amounts
Term insurance policies offer high coverage amounts, which means you can get substantial financial protection for your loved ones in case of your untimely demise.
You can choose the coverage amount based on your financial goals, such as your family's future expenses, outstanding debts, and more.

Flexible Policy Terms
Term policies deliver flexible policy terms, which means you can choose the term of the policy based on your needs. You can opt for a policy term of 10, 20, or 30 years, depending on your financial goals and requirements.
This flexibility ensures that you can customize the policy to suit your specific needs and protect your family's financial future.

Tax Benefits
Term insurance policies or life insurance offer tax benefits under Section 80C of the Income Tax Act, of 1961. If you hold a term policy, you may be eligible to receive a deduction of up to Rs. 1.5 lakh on the premiums you have paid towards it.
Additionally, the death benefit received by your family in case of your demise is tax-free under Section 10(10D) of the Income Tax Act. This means that it not only offers financial protection to your loved ones but also helps you save on taxes.

Peace of Mind
An insurance policy offers you the assurance and comfort of knowing that in the unfortunate event of your unexpected passing, your loved ones will be financially safeguarded and taken care of. It can be challenging to predict the future, and unexpected events can occur at any time.

Important Points to Consider Before Buying a Term Insurance Policy in India
Before buying a term policy, there are several points you need to take care of.

Coverage Amount
The coverage amount of your insurance policy is the amount your family will receive in case of your death. It is crucial to choose an adequate coverage amount that will cover all your family's financial needs, such as outstanding debts, future expenses, and more.

Policy Term
The policy term of your policy is the period for which the policy will remain in force. It is essential to choose a policy term that aligns with your financial goals and requirements. You can opt for a policy term of 10, 20, or 30 years, depending on your financial goals.

Premiums
The premium of your term insurance policy is the amount you pay towards the policy in exchange for the coverage. It is crucial to choose a premium that is affordable and fits your budget.

Claim Settlement Ratio
The claim settlement ratio of the insurance company is the percentage of claims that the company has settled in the past.
Moreover, it is essential to choose an insurance company with a high claim settlement ratio, as it ensures that your family's claims will be settled in a timely and hassle-free manner.

Exclusions
Exclusions are the circumstances under which the insurance company will not pay the claim amount. It is crucial to read the policy documents carefully and understand the exclusions before buying the policy.

Conclusion
Term insurance policies or life insurance provide a range of benefits, including affordable premiums, high coverage amounts, flexible policy terms, tax benefits, and peace of mind. By opting for a term insurance policy, you can protect your family's financial future and ensure that they are taken care of, even in your absence