3 Reasons Why Homemakers Need Life Insurance Plan

Men and women who work consider purchasing life insurance to offer financial security to their dependents. In case of their unfortunate demise, the death benefit can be used by their family members for managing their financial needs. In other words, life insurance policies try to compensate for the loss of income of the breadwinner when they are not around anymore.But what about homemakers? As they do not work and earn, should they consider purchasing life insurance too? Definitely, yes! Check out some of the top reasons why life insurance makes a lot of sense for homemakers as well-

Just like any working individual, the primary purpose of purchasing life insurance for a homemaker is financial security for the family members. A homemaker is responsible for a host of household duties, ranging from cooking, cleaning to taking care of the kids. The family might need external help in case of their unfortunate demise.With the rising costs of living, the breadwinner already has several financial obligations to take care of. Hiring outside help would mean additional burden. A life insurance policy purchased for the homemaker could prove very useful in such a scenario.

Most households now rely on loans for a host of their expensive purchases. Be it a home loan, car loan, or a loan taken for your child’s higher education, the death benefit received by the family in case of the homemaker’s demise can abundantly help with the repayments.Even if the death benefit is unable to close off the loan entirely, it definitely will reduce the loan burden to an extent for the primary breadwinner of the family.

A life insurance plan, like ULIP , combines insurance with investment. Some part of the paid premium is reserved for the investment component, which is made in the fund of the policyholder’s choice. On maturity, the insurer then makes a lumpsum payment to the policyholder. In case of the policyholder’s demise, the insurer pays the death benefit and the returns generated to date.A separate ULIP can be purchased in the name of the housewife, which will make an additional contribution to the household’s long-term financial stability and growth. Moreover, if the husband and wife have separate ULIPs, one of them can invest in an aggressive equity fund while the other can select a more stable debt fund to add more diversity to their investment.

The amount of hard work and effort that a homemaker puts into her household would be rewarded very generously if she would’ve been a salaried employee. But she does all of it without expecting any sort of monetary compensation.Just like the breadwinner of the family, life insurance for homemakers offers a host of benefits that provide financial security and stability to the entire family. Browse through some of the most popular types of life insurance, like endowment plans, ULIPs, whole life insurance, and money-back plans to select one that best meets their insurance needs.

The information contained herein is generic in nature and is meant for educational purposes only. Nothing here is to be construed as an investment or financial or taxation advice nor to be considered as an invitation or solicitation or advertisement for any financial product. Readers are advised to exercise discretion and should seek independent professional advice prior to making any investment decision in relation to any financial product. Aditya Birla Capital Group is not liable for any decision arising out of the use of this information.