Buying a term insurance plan is climacteric in everyone’s life. Therefore, it must be done carefully and with clear thoughts of the future. The question is not just about mere achieving a lump sum amount after gratuity, but to craft your dream or for the person for whom you are planning.
It’s very simple as regular premiums keep your life insured. The basic concept behind life insurance or term insurance is to attain a lump-sum amount from the company, in case of the holder’s unexpected demise. The amount becomes really helpful for the family to retain financial stability and paying off liabilities if left behind. So, this indicates the importance of carefulness when purchasing a term policy. If you are too, impetuous, your family may head to financial hardships in your absence, in spite of giving the best efforts.
So, let’s take a look at some of the best plans and policies before buying term insurance.
Term insurance or LIC term plan is a policy that provides fixed coverage to the insured for a particular period as per the term of the policy. The payments released by the company are provided at a fixed rate. If in case, the insurance holder gets the call from the God (unfortunately), while staying within the term of the policy, the insurer pays a pre-decided amount to the nominee either in installments or in full.
In India, there are even some insurance companies that provide full-coverage if the nominee becomes disable or partly-disable. This happens when the incidents tend to disrupt regular income of the holder. If the term of the policy has been survived by the policyholder, he/she is destined to receive the entire amount of premium in the form of single payment or installations along with interests.
There are multiple companies in India that provide an array of policies for the customers when they look for buying a term plan. Various companies include various clauses in their policies while keeping the basic norms intact. Now, with a bouquet of plans, how will decide on which to conclude your search? Here are some key parameters that can help you choose the best term insurance plan.
So, basically, the best plan will be the one that has the ability to pay money instantly to your family members without facing any hassle. You must ensure, during your absence, they must not suffer while acquiring the sum of the amount designated by the insurance.
After considering the important parameters of term insurance, you must focus on the key features to make yourself aware of different sections and their facts.
The best term insurance plan can help you in saving taxes. Under the section 80C from Indian Constitution, a maximum amount of INR 1.5 lakhs per year can be shown as deduction till you are paying the premiums.
When filing an insurance proposal plan, it is important to mention the nominee name. In most cases, wives, children and close relatives are shown as nominees. You must ensure, under the MWP Act (Married Woman Protection Act) the sum will be passed to the nominee without any hassle. This act allows a married man to protect the insurance policies to provide benefits to the nominee.
Term insurance plans are of course a sensible investment that protects your future with a handsome financial portfolio. Keeping the entire discussion in mind, go ahead and find the best term plan that suits your family’s dream.