The pandemic has struck many of us with lesser job security. It has made us vulnerable to the insecurities of life rather than exposed our vulnerabilities to the world, which can be exploited by anyone at any point in time. We can either consider it an opportunity and invest or let the time pass by and realise this mistake later in life, which will certainly amount to regret and guilt. Everyone in this world has been assigned some responsibilities. If you are a family man, then keeping your family's interests secured is your responsibility which you can be assured of by buying a term insurance plan.
How does a Term Life Insurance Plan Give Returns?
A term life insurance plan is not a saving and investment plan. Hence, it doesn’t offer any returns directly. However, if you buy a term plan with return of premium option, you have a chance to get your premiums back. If the policyholder outlives the policy term, all the premiums paid by them during the policy term, will be paid back. That way, it’s a win-win situation for the policyholder.
As a term insurance plan is a pure protection plan, it doesn’t have a savings component. Here are a few ways a term insurance plan can help you:
1. It is a policy which keeps the policyholder covered for life. In case of any emergency, this may include death, medical emergency, the insurer is bound to make the payment to the insured and avail all the assured benefits with the policy.
2. The premium payment of the same can either be periodic, or a lump sum amount is also an option, whichever the client finds viable.
3. Remember that if the insured person does not claim it in the given time frame of the policy, they choose to either forego the policy or extend it at some other premium rates.
What are the Benefits of Buying a Term Insurance Plan?
The premium paid for purchasing or renewing a term insurance policy can be claimed as a deduction by policyholders. Section 80C of the Income Tax Act allows you to deduct the premium amount from the total income, thereby bringing down the taxable amount. This, in turn, reduces your tax liability. In addition to this, the death benefits paid out to your beneficiaries are also exempt from tax, as per the provisions of section 10 (10D). Here are a few other benefits of buying a term insurance plan:
1. The choice of payment (periodical or lump sum) is the choice of policyholder.
2. In case of death during the term of the policy, the nominee is the one who can avail the benefits of the policy.
3. The policy's beneficiary can either choose to claim the amount in a lump sum or get a monthly payment.
4. The term insurance policies can be of some additional value as the policyholder can get tax benefits under the Income Tax Act 1961.
The minimum age to buy a term plan is 18 years, while the maximum age of eligibility is 65 years. What needs to be remembered while buying any of the policies is that the premium of these policies keeps increasing with age, so, it is advisable to buy term insurance plans at an early age to enjoy maximum benefits.
Return of premium option has been an attractive feature of the term plan that even though they have a higher premium rate than the life insurance policies but the assurance of getting back the premium is what makes this term plan popular and successful.
How can Canara HSBC Oriental Bank of Commerce Life Insurance help you?
Canara HSBC Oriental Bank of Commerce Life Insurance offer iSelect Smart360 Term Plan – a term insurance plan with return of premium option along with a host of other benefits. You can buy this term plan online, and also add your spouse to the same policy at discounted rate. This term plan offers whole life cover that will give you life cover till you turn 99.
This is an affordable term life insurance plan that you can easily buy and you can also choose the premium payment frequency as per your financial capabilities. iSelect Smart360 Term Plan is a pure protection plan that will help you secure the future of your loved ones, financially.