Today, almost everybody owns a life insurance policy. It could be for various reasons like investment purposes or for tax benefits, but the key point is that it provides complete peace of mind. With insurance plans, one does not have to worry about their family’s future security in their absence. These plans provide financial security to the surviving family members after the death of the insured.
Insurance is a must for anybody who has financial dependents. The age bracket to buy a insurance plan is approximately from 18 – 75 years of age. Most of the banks have a minimum and a maximum amount of money to be assured.
Types of Life Insurance Plans
Broadly, the two main types of insurance policies are term insurance and whole life insurance. Term Insurance Plans are the most basic and simplest plans. These plans provide a cover for risks only for a short period of time. After the term comes to an end, you can renew the plan but chances are that the premiums will rise. These plans are economical.
On the other hand, whole life insurance plans are expensive but these policies continue for as long as the insured lives. These plans are sometimes treated as investment options because one does not receive any money till the death of the insured.
Other plans include unit link life insurance plans that offer great investment options along with financial security. Usually, one has to pay two separate premiums – one for the life insurance and one for investment. These plans are beneficial as they provide financial solutions during your lifetime as well as after your lifetime to your family members.
There are retirement insurance plans available for senior citizens too. Insurance policies are extremely important for such people as these plans offer security and freedom to the surviving spouse. Child plans are another choice in insurance plans. These policies provide financial aid for your child’s education, marriage, etc. Another option are the health insurance policies. Health insurance policies provide a cover for medical expenses. These plans are suitable for people who suffer from health problems like diabetes, cancer, etc.
Riders in Life Insurance
Riders are the additional benefits that one can add to their life insurance policies. However, the premium amount increases with the inclusion of these riders. There are several types of riders in insurance plans offered by banks. The most popular of all are:
Critical Illness Benefit Rider: It offers financial aid in case the insured gets diagnosed with critical diseases like cancer, heart attacks, kidney failure, etc. Accidental Death and Disability Benefit Rider: In case the insured becomes disabled following an accident, this rider covers this risk.
Tax benefits as per the Income Tax Act, 1961 offer a deduction in the premium amounts, investments, dividends, etc. However, these benefits are subject to amendment regularly.
These Plans protect the needs and requirements of your loved ones in case of unfortunate events. It helps keep your family safe and secure even when you are not around.