Understand The Importance of Having the Best Life Insurance
One of the most integral lifestyle choices that working professionals have to make today is choosing the best life insurance policy that provides complete coverage and secures one’s future in the face of unforeseen illness or death.
In an effort to create affordable life insurance options for all, while also incentivising financial literacy and planning in the masses; policy providers have introduced many life insurance types that come with their own benefits and features. Read more to understand the fundamentals of life insurance plans and how one can avail financial solutions through the best life insurance policy they can afford according to their needs.
Life insurance plans can be defined as an insurance instrument which enable the coverage of the needs of the insured and their dependents through an assured benefit sum in the event of the policyholder’s demise. A standard life insurance policy in India is considered to be one of the most affordable means of securing one’s future where premiums are low and one can customise their coverage and payout methods as per their convenience.
Being a basic and essential necessity, life insurance policies have many added benefits and features available to be added for people across all income brackets. These benefits can be integral in helping the policyholder develop a coverage plan that aids them and their dependents in the event of any unforeseen circumstances. Let us look at the benefits one can expect to find in the best life insurance policies in India:
- Affordable Premiums: The more complex a plan is, the higher the premiums for them are. Even the best life insurance plan in India is one that is simple and accessible to people across all income strata. Hence, for those who are starting out in their professional careers, with limited finances can choose to a life insurance plan as they are one of the most affordable plans available in India.
- Death Benefit Payouts/ Sum Assured: The amount that is paid out to the beneficiaries as denoted by the policyholder is one that is assured and handed over to the beneficiaries of the policy at the time of the insured person’s passing. This payout can be customised into a staggered monthly income instead of a lump sum if deemed fit for the beneficiaries.
Since the central goal of a life insurance plan is to insure a person’s life, it eases financial stress on their dependents or beneficiaries, where they are able to navigate their absence financially; especially if they were the primary income earner.
- Rider Benefits: One can add riders for Income, Waived Premiums, Disability, Accidental Death or even Critical Illness in their existing life insurance plan. The cost of these riders added to the basal premium cost; hence one should choose if it is absolutely essential.
- Tax Benefits: The premiums paid for a standard life insurance plan and the payout sum thus received from the same at the time of maturity is exempted from taxation under Section 80C and 10(10D) of the Income Tax Act, 1961.
- Return of Premium: Since a life insurance plan such as a term insurance plan does not offer any maturity benefits; one can avail return of premiums in the event the insured lives beyond the policy tenure. After policy completion one can receive their premiums except for the taxes, and additional rider costs.
- Corpus Building: The best term plan in India term insurance plan can be expected to be an optimal insurance that has its own investment benefits as well. Aided by the best life insurance policy, one is able to build a supplementary financial resource for their dependents in the future, which is exempted from taxation and market risks.
While insurance plans cover most unforeseen circumstances and deaths, there are some situations where a policyholder or beneficiary may not receive the claim if the situations fall under the listed exclusions under a life insurance plan. Some common exclusions are:
- Death by Suicide: In most life insurance plans, if the policyholder dies by suicide, then the beneficiaries are not eligible to apply for a claim. It is a standard practice across all insurance providers to deny insurance claims if an insured individual commits suicide within 1 year of the policy commencing.
- Lifestyle Diseases: In the event that an insured individual passes away from diseases caused by heavy tobacco consumption or alcohol, their insurance claims may be denied in the event the provider understands their dependence was concealed at the time of the policy being purchased.
- Accidental Death (Special Cases): Deaths caused in war, during childbirth, criminal activity, or hazardous activities such as racing or speeding are excluded under life insurance claims.
- Death Cased by Terrorist Attack: It is important to note that insurance plans do not process death benefits for insured individuals who pass away due to a terrorist attack.
- Non-Disclosure of Illness: Not disclosing a pre-existing health condition is detrimental for an insured person’s dependents, for if the policyholder passes away and their death is determined to have been caused by the aforementioned undisclosed condition, the insurance provider will refuse the claim.
The purchase of the best life insurance policy is more or less a simple and intuitive process today with the benefits of online resources as well. To explore further, you can reach out to financial advisors over at Max Life Insurance who will provide assistance through every decision and feature before you commit towards safeguarding your future.