Term plan is a type of life insurance that provides coverage for a specific period. It’s a simple and affordable way to secure your family’s financial future in case of your untimely demise. While most people know about the basics of term insurance, there are some interesting facts that you probably didn’t know.

Here are some term insurance benefits.

• Affordable Premiums

One of the most significant benefits of term insurance is its affordability. The premiums for term insurance policies are relatively low compared to other types of life insurance policies. This makes it a great investment option for young adults who are just starting their careers and want to secure their family’s financial future. You can use term insurance calculator to know the premium for the sum assured.

• High Coverage

Term insurance provides high coverage for a low premium. This means that you can get a large amount of coverage for a relatively low premium. The coverage amount is usually based on your annual income and can range from a few lakhs to crores of rupees.

• Flexible Payout Options

Term insurance offers flexible payout options to the policyholder’s beneficiaries in case of their untimely demise. The payout can be received as a lump sum, monthly income, or a combination of both. This flexibility ensures that the policyholder’s family can use the payout in the most efficient way possible.

• Riders Can Enhance the Coverage

Riders are add-on benefits that you can opt for to enhance the coverage of your term insurance policy. Some popular riders include accidental death benefit rider, critical illness rider, and waiver of premium rider. These riders can provide additional coverage and financial security to your family in case of unforeseen circumstances.

• Renewable and Convertible

Term insurance policies are renewable and convertible. This means that you can renew your policy after the policy term is over and continue to enjoy the coverage benefits. You can also convert your term insurance policy into a permanent life insurance policy if you want to continue the coverage beyond the policy term.

• Tax Benefits

Term insurance policies provide tax benefits under section 80C of the Income Tax Act. The premiums paid towards the policy are eligible for tax deductions up to Rs. 1.5 lakhs. The death benefit received by the beneficiaries is also tax-free under section 10(10D) of the Income Tax Act.

In this article, we’ll explore some of the lesser-known facts about term insurance and why it’s a smart investment for your future.

• Term Insurance is Affordable

Term insurance is one of the most affordable types of life insurance available in the market. The premiums for term insurance are relatively low compared to other types of life insurance policies. This makes it a great investment option for young adults who are just starting their careers and want to secure their family’s financial future.

• Term Insurance Provides High Coverage

Term insurance provides high coverage for a low premium. This means that you can get a large amount of coverage for a relatively low premium. The coverage amount is usually based on your annual income and can range from a few lakhs to crores of rupees.

• Term Insurance Offers Flexible Payout Options

Term insurance offers flexible payout options to the policyholder’s beneficiaries in case of their untimely demise. The payout can be received as a lump sum, monthly income, or a combination of both. This flexibility ensures that the policyholder’s family can use the payout in the most efficient way possible.

• Riders Can Enhance the Coverage

Riders are add-on benefits that you can opt for to enhance the coverage of your term plan policy. Some popular riders include accidental death benefit rider, critical illness rider, and waiver of premium rider. These riders can provide additional coverage and financial security to your family in case of unforeseen circumstances.

• Term Insurance is Renewable and Convertible

Term insurance policies are renewable and convertible. This means that you can renew your policy after the policy term is over and continue to enjoy the coverage benefits. You can also convert your term insurance policy into a permanent life insurance policy if you want to continue the coverage beyond the policy term.

• Term Insurance Provides Tax Benefits

Term insurance policies provide tax benefits under section 80C of the Income Tax Act. The premiums paid towards the policy are eligible for tax deductions up to Rs. 1.5 lakhs. The death benefit received by the beneficiaries is also tax-free under section 10(10D) of the Income Tax Act.

Conclusion

Term insurance is an affordable and effective way to secure your family’s financial future in case of your untimely demise. It provides high coverage for a low premium and offers flexible payout options to the policyholder’s beneficiaries. Additionally, riders can enhance the coverage of the policy, and the policy is renewable and convertible. By investing in term insurance, you can enjoy tax benefits and ensure that your family is financially secure even in your absence. So, if you haven’t already invested in term insurance, now is the time to do so and secure your future.