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Why Life Insurance

7 July 2016 No Comment

canstockphoto27243957With growing older and more responsible the need of life insurance increases. Having a life insurance policy is important and helps to take out any financial sting from a sudden loss. The amount of insurance bought by the insured depends upon the standard of living one wish to assure the dependents. Having life insurance helps to fill the gap between the financial needs of the dependents. In general we can explain life insurance as an agreement between an insurance company and the insured under which a guaranteed sum amount is paid to the beneficiary in case of unfortunate demise of the policy holder.

However prior buying a life insurance plan one should determine that how much life insurance he/she should carry by analyzing the different needs of the family in the event of demise of the bread winner of the family. The number of needs that can be satisfied by life insurance policy are

  1. The policy can contributed to pay off the end time bills of the individual’s like medical bills and funeral expenses.
  2. Provide lump-sum for child’s education
  3. Provide funds for retirement
  4. The policy offers life income for the spouse
  5. The policy provide a monthly income until the children of the insured are grown and out of school.

Depending upon the needs of the Individual there are different types if life insurance offers by company

  1. Term Insurance
  2. Endowment Plan
  3. ULIP-Unit linked Insurance Plan
  4. Money Back Life Insurance
  5. Whole Life Insurance

Some of the major points covered by life insurance and term insurance are:

  1. Life insurance plan ensures to reimburse the cost of funeral and burial expenses. It cover the cost of medical bills and funeral expenses in case of demise of the bread winner of the family. This coverage offers a great help for the demised family who are already dealing with much bigger suffering.
  1. As there are numerous family who totally rely on the income of the primary salaried person of the family or even if the family have two breadwinner who meets the need major expenses. The demise of primary provider can leave the family with financial burden. Struggling to pay the mortgage or can even be unable to buy the basic needs of the family. Term insurance or life insurance policies are designed to fulfill the current standard of living of the insured family. The plans are designed to help the family to maintain a standard life style after the loss of income that come along with the tragic loss of the insured.
  1. Even if the family can survive the sudden loss of income the death of the major salaried person can create a challenge for the family to achieve the major long term goals. A life insurance can help you to achieve the long term goal and ensures that one can achieve a better standard of living and fulfill their major dream in life.
  1. Some of the insurance policies like endowment plan, ULIP plan, money back plan, etc. allows the insured to cash out their insurance at the end of policy tenure. Moreover, the policy offers a permanent life insurance that grows in value over time and can ultimately be cashed at the end of the policy term. The investment plans having a life insurance policy allows the insured to avail the advantage of tax- benefit under section 80 C of income tax act.
  1. One don’t need to buy a policy that is too expensive and comes out of your affordability. Depending upon the health and income individual cab buy a policy according to their suitability. In today’s time one can surf online get a wide options life insurance policy. To choose the most suitable plan according to your own needs you can compare the plans online and choose the plan that provide maximum coverage in minimum premium.

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