Life Insurance Is A Must For Long-Term Financial Security

Today, many youngsters, especially the millennials, abide by the 'You online Live Once' mantra. It makes people do adventurous and sometimes even reckless things. While it is perfectly fine to live in the moment, you must also be more responsible and think about the future.One of the best and definitive ways to secure the future is to purchase a life insurance policy . A life cover ensures financial security for your family in your absence. It also allows you to invest in long-term goals and be in a financially stronger position to tackle the uncertainties that you or your family may face in the future.

• Helps replace the loss of income Life insurance is a contract between you and the insurance company wherein the insurer agrees to pay a fixed amount to the beneficiary in the event of your demise before the end of the policy term. Thus, it ensures that your family can meet their regular expenses, and they don't feel the pinch due to loss of income.
• Secures your child's future As the family's breadwinner, securing your child's future would be one of your biggest responsibilities and a priority. Having a life insurance policy can help you secure your child's financial future even when you are not around. The death benefit can help them pay for their big expenses, including education and marriage.
• Helps your family pays off the debt In the event of your untimely death, the insurance company pays the sum assured to the family. The amount can be used to pay off the dues and debts, including personal loans , home loans , credit card due, etc. Thus, investing in a life insurance cover early on can help protect your family from falling into the debt trap and drain off the savings when you are not around.
• Helps you accomplish your long-term financial goals A life insurance policy is not just about getting protection against life. Today, insurance companies in India offer a variety of insurance plans that not only let you get protection but also allow you to grow your money over time. One of the most popular types of life insurance plans, the ULIP (Unit Linked Insurance Plan) , enables you to invest in the money market and build a sizeable corpus for your future goals.
• Helps you reduce tax liability Apart from helping you secure your family's financial future, a life insurance policy is an excellent investment that enables you to reduce your tax liability. No matter the type of life insurance policy you purchase, be it a term plan or a ULIP, the amount you pay towards the premium is eligible for tax benefit under Section 80C of the Indian Income Tax Act. Thus, every year, you can get a deduction up to a maximum limit of Rs. 1.5 lakhs.Additionally, when the insurance company pays the death benefit, the proceeds are tax-free in the hands of the nominee under Section 10 (10D).
• Protects you against other uncertainties Today, all insurance companies allow the life insurance policy buyers to customize the plan to suit their specific protection needs. You have the flexibility to choose riders or add-ons to your base plan and wide the protection scope. For instance, you can purchase an accidental death cover to get protection against accidents or buy a critical illness cover to help you pay the medical bills if you are diagnosed with any terminal illness.

Thus, life insurance plays a critical role in helping you get relief from the relentless pursuit of financial security for the future.

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.