Benefits of Term Insurance

What are the Benefits of Term Insurance

A Term Insurance policy provides various advantages that make it a must-buy. Here are some of the most significant benefits that you must know about:

• High Sum Assured at Affordable Prices:

  It promises a high-value Life Cover. For Instance - to gain a better understanding, we have compared the premiums of the HDFC Click 2 Protect for the different Sums Assured at the age of 30 years. Take a look:

  Age	Sum Assured	Policy Tenure	Monthly Premium (in Rs.)
  30 Years	50 Lakh	30 years	629
  30 Years	75 Lakh	30 years	848
  30 Years	1 Crore	30 years	1,024
  30 Years	1.25 Crore	30 years	1,222

  Take a look at the below-given graph for an idea of how the premium increases with increasing sum assured:

• Comprehensive Coverage:

  Today's Term Insurance Plans offer a variety of coverage options, rather than just covering the risk of premature death. You can choose from a variety of plans available under Term Insurance plans and get coverage for the following events:

  • Terminal Illness
  • Accidental Death
  • Critical Illness
  • Accidental Disablement
• Customizable:

  Nowadays, Term Plans come in different variants. You can choose the coverage benefits of your policy as per your needs. These variants provide flexibility in paying premiums as you can pay the premium regularly or in a single installment as per your affordability. Even when it comes to the death benefit, many term insurance plans provide you the option of getting it in a lump sum, monthly payments (uniform or increasing), or a combination of the two. As a result, you can customize your term insurance coverage to meet your specific needs and obtain the best policy.

• Easy Availability:

  Both online and offline options are available for Term Insurance. As a result, you will have no trouble in finding and buying the policy. Buying Term Insurance through an online platform is much easier for you as you can buy the policy from your own home or office. You can visit the Insurance Company's website, enter your details, and buy the policy you want. Alternatively, you can visit PolicyX.com and compare many Term Plans available, choose the best policy, and buy it online in a few simple steps. Thus, buying a term plan is simple, allowing you to invest in one conveniently.

• Financial Security:

  A term insurance policy's main objective is to provide financial security to you and your family. If your family receives financial assistance from a term insurance policy in your absence, they can meet their lifestyle needs. Your children will be able to receive the education they require, and your family will be able to meet its financial obligations.





• Tax Benefits:

  Term Insurance plans are tax benefit plans that provide you with Tax Benefits at the time of purchase as well as when the plan benefit is paid. The premium you pay in a Term Insurance policy allows you the deduction under Section 80C of the Income Tax Act, 1961. If the premium is up to 10% of the total sum assured, you can claim a deduction of up to INR 1.5 lakhs under Section 80C. Your family will get a fully tax-free death benefit. Moreover, if you choose a return of premium term plan, the premiums you receive on maturity will be tax-free under Section 10(10D) of the Income Tax Act, 1961, as long as the premium does not exceed 10% of the total guaranteed.

  • Section 80C:

    The Income Tax Act allows you to claim tax benefits on the premium you paid for the policy. The premiums paid for term insurance, up to a maximum of INR 1.5 lakh, are tax-deductible under Section 80C of the Income Tax Act 1961.

  • Section 10(10D):

    The maturity benefits offered under the Term Insurance policy are also eligible for tax exemption under Section 10(10D) of Income Tax Act 1961.

• Maturity Benefits:

  A Term Insurance plan only offers death benefits to the beneficiary of the policy. However, Plans such as TROP (Term Return of Premium Plan) offer maturity benefits in the form of the return of premiums if the insured survives the entire term of the policy.

• Accidental Death Benefit Coverage:

  Accidents can occur at any time and can result in death or dismemberment. So, you can add a cover of an Accidental Death Benefit. You can add this rider to your term insurance policy to give additional benefits or coverage in case of an accident resulting in death or dismemberment. As a benefit of a term insurance policy, the amount promised is paid to the beneficiary in a lump sum according to the contract.You can add an accidental death rider to your Term Insurance Policy when you buy it or later if you want to avail the advantages of it.