Prefer to Buy Term Insurance over Other Investment Options

As you grow older and your finances start improving, you then start looking for ways to invest your money to improve your financial future. No matter what your ultimate objective is, there are now several investment options available in India to suit every type of investor.But if you are new to the world of investing, it’d be better if you begin your journey with a term insurance plan. Here are some of the top reasons that make term plans one of the best investment choices-

In one way or the other, all your hard work, savings, and investments are aimed at improving the overall financial health of your family. Life insurance like term plan ensures that the financial needs of your loved ones are taken care of in case of your unfortunate demise.Any other investment option, be it mutual funds or fixed deposits , does not offer the level of protection and financial coverage that you get with term plans.

Unlike many of the investment options, you don't need a lot of money to invest in a term plan. In fact, term plans are cheaper than standard life insurance plans . This ensures that you can invest in one even if you’ve recently started working.You also get the option to pay the policy premium on an annual, bi-annual, quarterly, or monthly basis for utmost convenience.

As term insurance is a type of life insurance plan , they too offer several tax benefits. For instance, annual premiums of up to Rs. 1.5 lakhs paid towards a term plan qualify for tax deduction under Section 80C of the IT Act.Even the death benefit that is received by the policyholder in case of the policyholder's demise is tax-free under Section 10(10D).

Every investment option comes with a certain level of risk. But no risks are involved when you buy term insurance . Simply continue paying the premiums up to the tenure to keep the policy active. In case of your demise during the tenure of the policy, your nominee receives the death benefit.Moreover, there are now different types of term plans like TROP (Return of Premium) , Level Term Plans, Increasing Term Plans, Decreasing Term Plans, and more to better meet the needs of the policyholders.

While term insurance plans do not generate any returns, the benefits they offer are more important than any investment. If you are looking for an affordable way to protect the financial wellbeing of your loved ones, there is no product better than term insurance.Look for a top insurer to know more about all the different types of term plans and select one that best suits your insurance requirements. Consider other investment options once you have made adequate arrangements for the financial future of your family with a term plan. Also Read: What is Term Insurance? Meaning, Benefits & Its Working

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.