A family term insurance plan is a must for the sole breadwinner of the family. The world we live in is full of uncertainties. Any unfortunate event can create havoc in the mental and financial stability of the family. So, having a family term insurance plan as a backup is a wise decision.
What is family term insurance?
A family term insurance plan ensures the financial stability of the insured person’s family after his/her sudden demise. It is a basic form of life insurance that covers multiple factors like critical illness, retirement planning, or children’s safety. The plan is active for a fixed period. The assured sum can be given in lump sum or monthly. The plan comes in handy to lessen the impact of the blow in the tough times of life.
From a sudden demise to retirement planning, family term insurance plays a vital role in supporting you financially. You can choose the type of family plan you want amongst the most preferred plans, which are:
- Term insurance plan – In the absence of the policyholder, term insurance safeguards their family. The death benefit is given to the nominee. However, this monetary help is given if the insured expires in the active years of the policy. To avail of maturity benefits, other options are needed to include in the basic plan.
- Retirement/ Pension plans – As the name suggests, this plan supports you in your resting years. A retirement plan is active till the age of 60. So, upon surviving the insurance period, you can claim the assured sum in a lump sum or regular payouts.
- Children insurance – This plan is opted to secure the future of your child. You can pay the insurance company in a one-time premium or regular premium. When the child becomes 18 years old, the assured sum can be claimed and used for expenses like education. It can also be useful for the child in the unfortunate demise of parents.
Read more: Difference Between Health Insurance And Term Insurance
What are the benefits of a family term insurance plan?
An insurance plan will come to the rescue of your family in many events. Even with one family term insurance, many important factors can be covered. It will benefit you in different ways like:
- Financial backup – You will have guaranteed monetary help to support your family’s financial condition. It will not erase the turmoil but surely give support to it.
- Covers unfortunate events with riders – Mishap is not only of one type. Diagnosis of a life-threatening illness, permanent injury, or loss of income also comes under mishaps. You can add some riders to your basic term insurance to build an extra precautionary shield.
- Tax Benefit – The insurance plans come with the advantage of being tax-free. The nominee can avail of the tax-free death benefit under Section 10(10D) of income tax. Furthermore, premiums paid towards the policy can be claimed tax-free under Section 80C of income tax.
Read more: Term Insurance vs Life Insurance
What are the features of a family term insurance plan?
The features of a family term insurance plan are:
- Offers the needed financial support to the family of the insured in their absence.
- A term insurance plan is the most affordable and preferred policy because of its low premiums and high returns.
- It provides you an option to choose the tenure period of the plan.
- Term insurance plan is flexible as you can add riders to strengthen the policy.
- Under term insurance, several different policies are available concerning different segments.
The bottom line is no one comes forward during tough situations. You are the one responsible for the betterment and stability of your family and own self. By buying a family term insurance plan, the insurance company is bound to give you the required financial support. You must choose a family term insurance policy that will cover your area of concern, be it a sudden mishap, retirement planning, or children’s security. So, don’t delay anymore and buy insurance now.
