Life insurance is a contract between an insurance policy holder and an insurance company in which the insurer promises to pay a specified amount in return for a premium upon the death of an insured person or after a specified length of time.
Life insurance provides a lump sum settlement to the policyholder’s family if the policyholder passes away. Though money cannot compensate for the loss, it assures that the family has no financial difficulties even after the breadwinner’s death.
- Financial Protection: A life insurance plan serves to reduce the danger of financial troubles for the policyholder’s family in the event of the policyholder’s untimely death.
- Long-Term Savings: Some insurance policies allow you to build money. If you want to make endless investments, you should consider the significance of life insurance. Such insurance products enable you to make systematic saves and accumulate cash for future aspirations.
- Tax Advantages: According to the Income Tax Act of 1961, life insurance provides tax advantages. Section 80C of the Income Tax Act allows you to deduct up to Rs.1.5 lakh. Maturity insurance programmes are potentially tax-free. This tax break is provided under Section 10(10D) of the Income Tax Act.
- Spend Less: The customer’s premium is determined by age, life expectancy, health, and gender. When you are young, you can afford to pay lower premiums for life insurance than when you are older.
5.Achieve Goal: Life insurance may help you achieve long-term goals like buying a home or preparing your retirement, kid education, travelling overseas, and so on.
- Get Comfort: Death is unavoidable. In the event that you are unable to provide for your family, the least you can do is guarantee their financial future with a life insurance policy.
