Why You Need a 1 Crore Life Coverage Term Plan?
Investing in a term insurance policy is paramount in an effort to secure the financially independent future of your loved ones. However, with too many options available in the market, it can be overwhelming to decide the optimum one.
If you are also confused about which plan and how much coverage you should choose, then a ₹1 crore term insurance policy provides sufficient inflation-protected coverage in case of any unfortunate event.
Term Insurance — What Is It?
Before you understand why ₹1 crore term plan is important, let's briefly recap the term insurance concept. Term insurance is a type of life insurance policy offering coverage for a specific period or policy term. Term insurance policies are popular because they offer high coverage amounts and are affordable.
If the policyholder passes away during the policy's term, the death benefit will be paid to the nominated beneficiaries. However, no payout is provided if the policyholder outlives the term.
Why is there a Need For a ₹1 Crore Term Insurance Plan?
Generally, a ₹1 crore life insurance policy is beneficial for people with dependent family members, ensuring better stability and peace of mind. The policy assures a huge amount of Rs. 1 crore to the policyholder’s nominees so that they can continue living their normal lives.
Now that you are familiar with the policy and its operation explore the key benefits of purchasing a ₹1 Crore term insurance.
1. Flexibility
As you make an intense decision about your life, including marriage, planning children, wanting to buy a house, etc, the policy offers you an option to adjust your life coverage amount. It will assist you in ensuring that your financial responsibilities are protected.
2. High Coverage Amount
₹1 Crore term insurance plan has much higher coverage amounts. Hence, your family members will get a significant payout with the assured sum of ₹1 Crore in case of your untimely death.
Using this amount, they can maintain their lifestyle, meet other financial needs, and clear any debts or liabilities. ₹1 Crore term insurance comes with several riders for additional coverage such as accidental death, critical illness, disability income and more.
3. Tax Benefits for Claim Payouts and Premium Benefits
Tax benefits for both premium payments and claim payouts are available. Meanwhile, the claim benefits availed by beneficiaries in case of your untimely death are tax-free under Section 10 (10D) of the Income Tax Act. Plus, premium payments for ₹1 crore plans are eligible for tax deductions under Section 80C of the Income Tax Act.
Conclusion
If you have a family and you want to secure their future, a ₹1 crore term insurance plan is the right choice for you. Besides the substantial coverage amount, a term plan's flexibility and tax benefits are worth the investment. Not just that, the premium you pay is relatively small in comparison to other types of life insurance available. You can also use a reliable term insurance calculator to estimate your desired coverage amount and premiums, ensuring it fits your budget.
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