With the unpredictability of life, there are always some things that are not in our control. Over the years, every individual has worked hard to give their family the quality of life that they deserve. With a good career, an individual manages to fulfill the dreams of their family. However, things can change significantly if the earning member of the family losses their life suddenly. Life insurance ensures that you do not face this problem. It ensures that in your absence, your family still has a financial backup to rely on. If you are not sure about buying life insurance, here are 10 reasons why it is a must-have.
10 Reasons life insurance is a must-have
- Provides a financial safety net
Being an earning member of the family, the loss of your life will not have only an emotional impact but even a financial one, since your dependents will find themselves in a tough spot financially in your absence. Having a life insurance policy ensures that in your absence, your family will get a sum assured which would help them fulfil their everyday needs.
- Helps pay-off liabilities
To fulfil your dreams and your goals, you are likely to take some financial aid. Be it in the form of a home loan, education loan, personal loan, or some other type of borrowing. With your earnings, you can pay off these debts easily. However, if something was to happen to you, your family would be held liable to pay off your debt. Having life insurance ensures that in your absence, your family can pay off any debt or borrowings with the sum assured that they receive.
- Affordable plans
To lock a life insurance plan at an affordable premium, you must buy it as early as possible. The earlier you buy, the lower your premium is likely to be. You can use a life insurance premium calculator to get an estimate of the premiums you have to pay for the coverage you need.
- Helps save taxes
While the primary reason individuals take life insurance is life cover, the secondary benefit of life insurance is the tax you save. The premiums that you pay for your life insurance are subjected to deductions as per Section 80C of the Income Tax Act. The coverage that your family receives in your absence is also exempt from taxes according to Section 10 (10D) of the Income Tax Act.
- Fulfils long-term plans
While life insurance is often seen as a product that provides security, many types offer savings and investment opportunities as well. When the policy matures, the maturity amount would be useful for fulfilling your long-term goals. You can use a life insurance premium calculator to plan your policy according to your goals.
- Helps you plan for retirement
When it comes to achieving long-term goals, life insurance with an investment or savings component comes in handy. When you have chosen a long-term life insurance plan, the maturity amount that you receive helps in building a retirement corpus.
- Inculcates the habit of savings
When you buy a life insurance policy that has a savings or investment part, with every premium that you pay, some money is saved or invested for your future. The policy inculcates the habit of saving among individuals.
- Provides add-on coverage with riders
There are several riders an individual can choose as an add-on to their base plan. These riders are additional benefits of life insurance that an individual can get by paying an additional amount of premium. Riders help in expanding the coverage of security for you and your family.
- Offers a sense of security
With life insurance, you get a sense of security and your mind is at peace. You know that in your absence, there is a financial backup for your dependents. It leaves you relieved to focus on your present as you have already secured the future of your loved ones.
- Protects against inflation
With rising inflation, the price of all goods and services increases over time. Having life insurance ensures that in your absence, your family has enough funds to beat the rising prices.
The above benefits of life insurance are the reasons why having a life insurance plan is a must. Ensure that you do your research and choose a plan that suits your needs.