Covid-19 pandemic has taught us to be well prepared in advance as we do not know when we might face uncertain and unforeseen events. Moreover, it is imperative to have a well-prepared financial backup so that our loved ones and we can seamlessly continue with our lives in the coming years, right? Investing in term plan have seen a rise in the past couple of years to secure our loved ones and us financially. Term plans provide financial security and provide our family members with lump-sum death benefits in case of the policyholder’s unforeseen and untimely death. With this, your loved ones can continue with their lives seamlessly, even when you’re not there to provide for them!
While investing in a term plan, we might have come across the term plan premium. Do you know what exactly do we mean by term plan premium?
First, let us understand what we mean by a term plan and a term plan premium.
What do we mean by term plan and term plan premium?
A term plan is a types of insurance plan wherein the policyholder pays a certain amount of term plan premium to the insurance provider and enjoys the benefits of the policy. The plan provides your family with lump-sum death benefits in case of the policyholder’s unforeseen and unfortunate demise. With this, your family will not have to face any financial constraint, even when you are not around to provide for them.
Talking about term plan premiums, it is a coverage payment made by the policyholder to the insurance providing company. It is paid as an amount for the policyholder’s financial security and ensures that he and his loved ones face no financial constraints in the future.
There are various other benefits of investing in a term plan. Let us see a few of them.
Benefits of investing in a term plan
- Financial Security
We never know when we might require financial aid because of an unforeseen event. If we are not prepared, it might create a huge hassle for us and our loved ones. Investing in a term plan ensures that you and your loved ones are financially secure and do not face any financial uncertainty in future.
- Lump-Sum Death Benefits
In case of the policyholder’s unforeseen and untimely demise, a term plan provides your family with lump-sum death benefits. This ensures that your loved ones do not face any financial constraints, even in your absence.
- Tax Benefits
The term plan premiums you pay to enjoy the policy’s benefits are eligible for tax benefits under Section 80C of the Income Tax Act. You can claim up to Rs. 1.5 lakhs annually under this section. However, tax laws are subject to change from time to time.
- Rider Benefits
Instead of investing in an all-new insurance plan to enjoy additional benefits, a term plan lets you choose rider benefits. You can choose rider benefits such as accidental death rider benefit, critical health rider benefits, waiver of premium rider benefit, etc. Please note that riders are not mandatory and are available at additional cost.
Keeping the above-mentioned factors in mind will help you opt for the best term insurance policy in 2022. Various term insurance plans are available to the policyholder to choose from. However, it is imperative to go with the best term plan to secure himself and his loved one financially.