A life insurance scheme is one of the best wealth-building vehicles due to the numerous benefits it has to offer. It is the perfect answer to obtain financial security and protection in the long run. You may, therefore, live your life stress-free, knowing that you are covered by such an insurance scheme.
There are multiple advantages of investing in a life insurance policy. Following are six major benefits of purchasing a life cover.
- Risk cover
Life is uncertain. In case of an unfortunate event such as death, your family may lack a financial support system. Since a life insurance policy is a life risk cover, you and your family are protected in an event of a premature death.
- Death benefit
Your beneficiary may avail of the death benefit in case of an untoward incident. The insurance provider is liable to pay the sum assured amount along with the bonus if any. This amount may be used by your near and dear ones to meet their lifestyle needs, pay off an existing loan, or meet funeral costs, among others.
- Tax benefits
Not only may you enjoy a life cover through a life insurance policy, but you may also avail of tax benefits on the premium paid. You may avail of a maximum deduction up to INR 1.5 lakh under Section 80C, 80CC, and 80CCE of the Income Tax Act, 1961. You may, therefore, invest in life cover and reduce your tax liability largely.
- Higher coverage
One of the most important benefits of investing in life insurance plans is higher coverage through riders. You may supplement your existing policy by opting for riders, also known as add-ons. Some of the most common riders that extend the scope of your life insurance cover include personal accident rider, critical illness rider, and waiver of premium rider, among others.
- Life stage planning
You may consider a life cover to help you meet financial goals at every stage of your life. You may plan for your life stage needs such as meeting your children’s educational costs, arranging finance for their wedding, purchasing your dream home, and planning a retired life, among others.
Life insurance plans, therefore, provide numerous benefits to you and your family. These insurance plans not only provide support in case of a sudden death but also acts as a long-term investment. You may, therefore, consider such an insurance policy as a part of your wealth planning.