How a term plan plays an important role in your family’s security

A term plan is one of the most necessary investments one has to make in their lives for the future of their family without them. For those who ask ‘what term is insurance’, it is an insurance plan for the family of the person buying it, in the event of an untimely death or emergency. It is the biggest security that an earning member of the family can leave behind in case of his absence.

One can choose from the range of term plans based on their annual income and expenditure, medical history, illnesses and other necessary documents. There are many ways in which a term plan plays an important role in your family’s security. So, before you go to buy a term plan, be sure to read this article.

Security

The main objective of a term insurance is to provide financial support to your family in case of emergency or death. Nobody wants to leave their family disoriented after their death. As a result of the uncertainty in life, it has become important to leave behind some kind of financial support for the people who are dependent on you so that they don’t face any hardships in your absence. So, monetary support is the first and most important characteristic of a term plan.

Monthly Income

Your family will need money for day-to-day expenditure even in your absence. So, along with the lump sum amount, your family will also get some monthly income to help them meet the usual household demands as well. The plans are made keeping in mind each and every financial challenge your family can be exposed to in your absence, and how to deal with them.

Lower Premium for you

As you grow older, your premium on term insurance increases. So, always look for a policy that provides minimum entry age and maximum coverage. In such cases, you can buy a plan at reasonable cost today and secure your family’s financial future. It is necessary to start saving up from a young age by investing in a term insurance plan. Not only is investing at a young age a wiser option, but it also saves premium costs and taxes.

Tax Exemption

The government has time and again encouraged investing in term plans. For that matter, S 80c of Income Tax Act, 1961, also offers exemption to those who have availed a term insurance plan. The exemption is on the premium paid on the term for a maximum limit of Rs. 1.5 Lakh. Along with that, the benefit that the nominee receives is also tax-free.

The stress of an unfortunate event happening to the earning member of a family is expected to leave the members disoriented and astray; both emotionally and financially. Although the emotional burden cannot be reduced, the financial burden can. And for this reason, it is always advised to buy a term insurance plan for your loved ones.