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Finance

How Term Insurance can ensure your financial stability?

Summary: A Term Life Insurance Plan is the simplest & purest form of life insurance. An insurance policy will keep you from emptying your emergency fund. Learn More..!

18 Mar 2022 by Team FinFIRST
importance of term insurance

There is a growing awareness about having a life insurance policy as a financial investment. With life speeding up and uncertainties increasing by the day, every family requires a life insurance policy that will help them deal with the death of a loved one, at the very least financially. To accommodate the growing demand for life insurance, insurers are developing policies that address the various needs of different individuals. 

A term life insurance plan is the purest form of insurance. There is no money back, no investment; it is just pure protection. All it does is provide death benefits if the insured person passes away during the plan term.

Here are five reasons why you should look at a term insurance plan:

Cheaper for Higher Protection


Term insurance is one of the simplest ways to protect your finances. Compared to other life insurance products, term insurance products are relatively cheaper and offer higher protection. So if you are 25 years of today, the insurance you would be paying for the next 30 years would on average, be Rs 2,000 for an insurance cover of Rs 1 crore. This means it's an investment of Rs 60,000 for a cover of Rs 1 crore. Due to the absence of maturity benefits and other complications, term insurance policies provide significant coverage at low affordable rates to most people. With term insurance now easily available online, the need for agents or intermediaries has reduced, ensuring you don't have to pay for agent fees.

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Full Coverage


Unlike other insurance plans, in a term insurance plan, you get complete coverage. When a person dies, his family gets the full sum assured. This fact alone should keep your mind at ease.   

Riders


Along with death coverage, most term life insurance policies include certain additional benefits called riders. Riders like accidental coverage, critical sickness coverage, return of premium, and so on are available for an additional premium cost. These riders ensure that you get the most out of your life insurance without breaking the bank.

Low Claim Rejection


Most insurance companies have a high claim settlement ratio. The few that are rejected are due mainly to incorrect data. So it is imperative you give the correct information about yourself. For instance, if you are a smoker, mention you are a smoker. Additionally, as per a mandate by the Insurance Regulatory and Development Authority of India (IRDAI), no insurance company can state non-disclosure of information, after two years of the plan being in effect.

Income Tax Benefits


Purchasing term insurance can bring early financial security and tax benefits under several sections of the Income Tax Act of 1961. It should be noted that a term insurance policyholder, regardless of age, can benefit from tax deductions under Sections 80C, 80D, and 10 (10D), the advantages of which differ.

Check out the various term insurance plans by IDFC FIRST Bank that cater to your financial needs and offer guaranteed financial coverage at various points of your life.

 

Disclaimer

The contents of this article/infographic/picture/video are meant solely for information purposes. The contents are generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances. The information is subject to updation, completion, revision, verification and amendment and the same may change materially. The information is not intended for distribution or use by any person in any jurisdiction where such distribution or use would be contrary to law or regulation or would subject IDFC FIRST Bank or its affiliates to any licensing or registration requirements. IDFC FIRST Bank shall not be responsible for any direct/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information mentioned. Please consult your financial advisor before making any financial decision.

The features, benefits and offers mentioned in the article are applicable as on the day of publication of this blog and is subject to change without notice. The contents herein are also subject to other product specific terms and conditions and any third party terms and conditions, as applicable. Please refer our website www.idfcfirstbank.com for latest updates.

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