What is the Role of Life Insurance?
Today, we are surrounded by countless uncertainties, which is why life insurance has become more of a necessity than merely a luxury. It is one of the first investments individuals make for ensuring security and stability in the lives of their loved ones. People have realised the importance of a good life insurance policy in their life, which is why the industry is about to witness a 15-18% growth in the year 2018. If you are still unsure, let’s discuss what role a life insurance plays in your financial planning and overall security.
Security for Your Family
A life insurance is a financial agreement between an insurer and you that guarantees a sum amount of money as a security in case of an unfortunate event. Although human lives are irreplaceable, a financial assurance can provide security to your family after you and reduce the risk of monetary loss for them. Moreover, if you are the sole earner in your family, a life insurance will help reduce your family’s stress of making ends meet after you are gone.
The term ‘guaranteed returns’ means, if nothing more, you will at least get the repayment of the total amount of premiums that you have paid for your policy. Moreover, the tax benefit of guaranteed returns life insurance is greater than that of a fixed deposit. Since an FD does not offer any additional compensatory benefits after the insured’s death, it is always advisable to buy a life insurance policy instead of simply keeping your money in the bank.
Stress-free Living with Affordable Premiums
A life insurance is a gateway to living your life without anxiety. When you buy a life insurance, you transfer the risk of a potential loss that will occur in your family after your death. If you think you do not have enough capital to invest, you can always opt for low-premium policies. There are policies starting from less than INR 20/per day, providing a coverage of up to INR 1 crore. Investing in such plans will put less strain on your wallet. Furthermore, it will liberate you from the constant worry of what will happen to your loved ones if something were to happen to you.
Essentials of Buying Life Insurance
Choosing the perfect life insurance plan can be very overwhelming for first-timers. But this is where this guide will assist you. Here are some of the essentials of buying life insurance.
1. Cash Value
Your policy’s value increases with every premium you pay. While every life insurance policy guarantees a fixed coverage, as a buyer, it is important for you to pay attention to the value of your policy in case you have to liquidate it.
2. Compare Similar Policies
While some insurance plans are cheaper than the others, their returns may be deceptive. Hence, it is important that you compare only those policies that offer similar benefits when making a comparison. Also, pay attention to the terms and conditions that you are agreeing to as it is extremely common for first-time policy buyers to choose the wrong policy without deliberating properly.
3. Look for Policy Riders
Insurance companies offer you an opportunity to customise and enhance your life insurance plan by employing policy riders. Policy riders are additional benefits that you can add in your insurance plans for getting more coverage. For instance, an accidental death benefit rider will get you additional compensation if you were to die from an accident.
4. Coverage Amount
Ideally, your coverage amount should be 10 times your current annual income. It should be enough to take care of your family until your spouse is alive and your children are at least 18 years old. Therefore, ensure that the policy you choose to buy will be able to replace your income for the next 20 years.
Hassle-free Insurance Process
Insurance companies have acknowledged what people need when it comes to buying life insurance. Apart from competitive pricing and numerous options to choose from, what you look for in your insurance provider is good service. Therefore, Coverfox.com has introduced a new way of buying insurance. Simply choose from a variety of personalised insurance quotes, pay online, and get your policy delivered in your inbox. Now, you have access to top-notch services at the convenience of your home.
Insuring your family for life is the biggest gift you can give to them. Buying a life insurance will not only secure their future but will also provide them with someone to look after them in your absence. Above all, a life insurance will serve as a tangible proclamation of your love for those that matter to you.