Life insurance, as the term defines itself is insuring life. Now, the question is whose life is getting insured? Well, Life insurance is a contract between an insurance company and policy holder, which can be either you or your family member. An insurance policy is taken to give financial support to insurers’ beneficiaries, which can be spouse, partner, parents and kin.
An insurance is taken on owner’s goals and financial needs. To get a protection for a set period of time one opts for Term Insurance, else they opt for permanent or whole life insurance for a life time coverage. The death benefits from all insurances is tax free.
To meet financial goals, insurance provides an advantage to individual or his family with financial coverage against the loss of life. Child’s marriage, post-retirement pension or regular income, house purchase and child’s education are few goals which can be achieved with insurance.
There are multiple life insurance options available in market to choose from .
Term Life Insurance
Term life insurance gives you the financial protection for a specific time like 10/20 years with the benefit of same premium amount. This insurance can be replaced with the lost income at retirement and safety net for beneficiaries. Also, you can do onetime payment instead for regular premiums.
Universal Life Insurance
Universal life insurance is a designed to provide coverage for a lifetime. Premiums being on higher side than other insurances, it gives you a flexibility to fluctuate your premium amount. Mostly used for flexible estate planning to help the beneficiaries for wealth transfer. It also helps in building cash value and gives death coverage benefits.
Whole Life Insurance
Whole life insurance is a kind of permanent life insurance that gives you lifetime coverage. Like Universal Life Insurance, premiums are slightly on higher side but are fixed. You are not given an option to fluctuate the premium amount. It also gives you a cash value that works as a saving and gives you tax benefit.
An endowment plan gives you a multiple benefits. With higher premiums, which are invested in mutual funds, the plan gives to death coverage benefits along with cash value.
Unit-Linked Plan (ULIP)
ULIP offers you investment and insurance. The policy holder is allowed to decide where to invest the money in financial market. Complete sum assured in given to beneficiary or nominee upon policy holder’s death.
The main benefits you get from Life Insurance is security for your family with a promise of financial support in hard time. You also get an option to take load against your policy. The insurance policy also gives you tax exemption benefit under section 80C and 10 (10) D of Income Tax Act. Dial advantage of investment and insurance.
Before you zero down you insurance policy choice, browse for life insurance quote online, contact financial experts, take advise from someone who already has a policy, terms and conditions of insurance company, consumer rating with brand’s market value. With all this don’t forget to keep a check on your age, health and driving skills. These plays a vital role, as companies calculate the premium accordingly. Premiums might get higher if they are not appropriate and you end up paying more.
So, you get grey hair, start browsing to get yourself a suitable life insurance and secure your loved ones.