Conventional wisdom recommends that people purchase life insurance when they are in the later years of their lives. People of all ages should, however, come to the conclusion that including a life insurance policy into their financial portfolio is vital in order to protect the significant milestones in their lives and the lives of their loved ones. It is impossible to overstate the importance of investing in life insurance policies. Life insurance is intended to provide financial protection in the event of the insured’s death.
It also serves as a sensible investment strategy, allowing you to achieve a variety of life objectives in the process. As more and more people realize the importance of investing in life insurance plans, the life insurance industry in India has seen consistent growth over the past few years. Between April 2016 and March 2017, the life insurance market experienced a 12 per cent increase in premium income, with premium income exceeding Rs.105.26 billion during this period. In India, there are more than 360 million policyholders, and the number is growing. If you are considering purchasing life insurance, the following are some of the advantages of doing so:
The younger you are when you buy your insurance, the less expensive your policy will be.
When life insurance plans are obtained at a young age, the cost of the policy is much lower. The younger you are, the more cost-effective your insurance policy will be. Even if you are currently single and do not have any immediate dependents, you should make arrangements for the insurance coverage you will need.
Individuals who live alone are usually required to provide financial assistance to siblings or parents. Another issue to consider is the capacity to be insured. A person’s insurability increases according to how healthy and young they are. The outcome is that you will be able to receive the most competitive insurance policy rates.
It is necessary to designate a beneficiary for life insurance policies in order for them to be valid.
Depending on the circumstances, a single beneficiary may be a member of a bigger group, as is frequently seen in practice. Instead of a single individual or organisation, a charitable organisation, family trust, or even a business might be named as a beneficiary in a will or estate plan. Beneficiaries do not have to be specific individuals in order to qualify.
Retirement Objectives Should Be Complemented
Everyone wishes to have substantial retirement assets that will last for a long period of time. You may assure that you will continue to receive monthly payments in the future by purchasing the appropriate life insurance policy. When you get life insurance, it allows you to augment your retirement funds.
Tax savings that are higher than before
You may be able to save money on your taxes if you have insurance coverage. It is always possible to claim the maximum tax deduction available under Section 80C, which is up to Rs.1.5 lakh, for premiums paid on life insurance contracts. Additionally, under Section 10 (D) of the Income Tax Act of 1961, you will be eligible to receive tax-free proceeds upon maturity or death of the investment.
Benefits payable upon death and how they are administered
Before we get started, here’s an explanation of what death benefit means: The beneficiaries of your life insurance policy will receive a death benefit payment if you die during the period of the policy – this might be in the form of a lump-sum payment or something else entirely. Before acquiring life insurance or filing a claim, it is important to be aware of a few important details about the beneficiaries.
It is possible that you will lose your eligibility for life insurance coverage in the future.
Existence is characterized by a high degree of uncertainty. Considering that you are currently healthy and in good shape, purchasing a life insurance premium may appear to be a waste of money. It is, nevertheless, worthwhile because, if you become ill later on, you will be unable to obtain life insurance coverage as a result of your condition. Obtaining life insurance as soon as possible is crucial in order to reduce the likelihood of your health deteriorating later on.