Living life to the fullest involves buying great materialistic things, investing in big assets, working to your best potential and partying hard. However, while you’re doing all this, life keeps slipping away and one fine day we face the music! Therefore it is important that before some unpleasant surprises knock our door, we do something more sensible and use our intellect and wisdom to take right decisions in life. One of the most important ones is to buy a life insurance plan and invest in not only your future, but also that of your near and dear ones.
Having an insurance policy is a necessity today given how unpredictable life has becomes and the cost of living is rising by the day. To ensure life goes on in your absence, you have to be financially wise so as to make things easier for your family members.
Let’s take you through some of the benefits of having a life insurance policy:
1) Lump Sum Amount
The best part about an insurance policy is that in the unfortunate scenario of your untimely death, your family members, specifically the nominee, will get a lump sum amount as the insurance cover. Depending on the coverage you had opted for, they would get a substantial amount at one go that would be tax free as well and will go a long way in coping with financial stress at least. The sudden loss of the bread winner of the family creates lots of chaos that is not easy to face. Till the time someone can take your place as far as earning money is concerned, the insurance amount can help to maintain the household expenses and live a routine life your family members are used to living.
2) Loans And Other Expenses
The insurance money can also be used in paying off any debts that you might have acquired like a vehicle loan, home loan or a personal loan. Also, the funds can be invested further so that they can be used to pay for your children’s education or at the time of their marriage. Generally, the trend is to get a substantial insurance cover that is multiple times of your annual income. This way your family members are assured of ample amount of funds to help them in their time of need.
Insurance can also be used as an investment. Every insurance policy comes with a maximum time frame. If the insured lives past that date, he can get the amount back with considerable amount of interest. This means years of paying premium can also be one of the safest investments you can make. Once you receive the funds after maturity of the policy, you can re-invest them in some other investment vehicle. In short, it’s a win-win policy whatever way you may look at it.
Another less-aware benefit of an insurance policy is that it can be used as collateral when taking a loan. Most financial institutions and banks allow a life insurance policy to be kept as collateral when issuing a loan for probable a child’s education, buying a home or for any other personal use. Having collateral also helps in getting a better rate of interest and you don’t have to part with your gold or any other asset for such loans. The policy will anyways give you the benefits it was bought for; this is just another advantage of investing in life insurance.
5) Tax Benefits
Under section 80D, you can avail of tax benefits on the premium paid towards your insurance policy. This has been, in fact, the most obvious reason for most people to buy a life insurance. But this is just one of the benefits out of so many. The tax rebate helps you in saving some money that can be used for better purposes.
After understanding the pluses of having a life insurance, you must be having queries as to how to go about it? The best way is to find out everything about insurance from a website that mentions details of every insurance product available in the market. Do a thorough comparison between different products, short-list the one that meets your requirements and then take the decision to buy it. It is as simple as that!
Do remember that life is precious and extremely short to do everything you want for your near and dear ones. Just to ensure that their life is not hampered or derailed in your absence, you have to take wise financial decisions. In order for them to continue living a healthy, happy and stress-free life, certain decisions have to be taken today. The first decision on such a priority list is to buy a life insurance!
[quote_center]Go ahead and take the call, now! Be safe and keep your near and dear ones, safer![/quote_center]