Unfortunate, isn’t it? Despite the increasing number of
players in the market and India being the second largest populated country, the
numbers present a dismal figure. The life insurance market has seen a
revolutionary change in terms of innovation and creativity. Plans which have
great new feature, good benefit structure, lower charge structure and a host of
features are being offered and yet the penetration shows a downward trend!The
numbers depict a continued fall in the penetration rate over the last 6 years
and it is a wake-up call for us.
Why ‘us’ you might ask. Well, it is we who shirk away from
insurance and contribute to its downward penetration trend. But why do we do
so? Is insurance a disposable product?
Life insurance, contrary to popular beliefs, is one of the
most important investments one can make if one wants to secure one’s future. We
all make investments with the sole view of earning good returns but what about
securing our future? Imagine the scenario when the bread-winner dies prematurely,
will his investments be sufficient to provide for the family’s living expenses
over the years? Only life insurance can solve this because this is the only
product which promises a lump sum benefit in the event of unfortunate death.
When we talk about life insurance, the Term insurance plan
offered by life insurance companies come to the forefront when the motive is
future financial security. A Term Insurance plan is the only plan which allows
a substantial Coverage against a very low Premium outgo.
So, if you want a big future security in terms of finance,
buy a Term Insurance Plan. Why?
Protection – term insurance plans form the essence of life insurance. They
come very cheap and cover the Insured against untimely death. The premiums against
the value of the coverage granted are affordably low making the plans light on
the pocket. In the event of death, the large benefit which accrues under the
term plan compensates the family’s financial loss and thus protects them
against the loss of income of the earning member
– I repeated it over and over and don’t mind saying it again! Term insurance
plans are very cheap. For a high cover of Rs.30 to Rs.50 lakhs, the premiums
amount in Rs.8000 to Rs.10, 000. Thus, they are very small and pocket-friendly
investments which provide a very good protection.
protection – loans are trending nowadays where every need can be funded by
a loan. As attractive as it may sound, loans involve repayments and repayments
involve a steady source of income. If the bread-winner dies, besides the loss
of income, the family also gets burdened with the outstanding loan repayments.
Having a term plan is the answer to this problem as well. The benefits which
accrue under the plan can be utilized to pay off the debt burden. The plan
thus, provides protection against liabilities too.
mind – when our future is secured, our emotional stability is also ensured.
A term plan, besides providing financial security, provides mental security too
because we know that our finances, assets and liabilities are protected from
any contingency caused due to untimely death. And as experts say, peace of mind
is something which cannot be bought, but when we talk about the financial
aspect of the statement, a term plan delivers a spot on result.
All said, it wouldn’t be wrong to sum up the entire
discussion in a single line which reads – Term insurance is a small investment
for a big future protection. If you still have a bit of cynicism remaining
concerning the cost factor, lay your mind to rest. Here are some of the premium
rates of term insurance plans offered by some leading insurers.
Assumed – age of the Policyholder is 35 years, Sum Assured
is Rs.50 lakhs and Term is 30 years.
Is the premium too high? Isn’t it a small investment? Isn’t
the protection big?
I hope your cynicisms are laid to rest. A term plan is an
inevitable weapon in your investment arsenal which would protect your financial
future and should not be given a miss. After all, which other investment avenue
promises such benefits?