Five Reasons to not quit a Life Insurance Policy
Despite the growing awareness about the importance of insurance policies, the number of people who have life insurance in India is woefully low. It means that hundreds of millions of people are left unprotected from uncertain events like accidents, illness, or any other event that could cause death. There are different types of life insurance policies available in the market to fulfill our financial needs at different stages of life. From death benefits to policies that serve as an insurance/investment, there are multiple types of life insurance policies available in the market.
A life insurance is a must for every individual living in this country. It provides financial cover to your loved ones after your demise. As life is very uncertain, we do not have the power to predict our death date. In the event of our unfortunate demise, our families will have to bear the brunt of many financial woes in addition to our absence.
A proper life insurance plan spares us and our family from all that agony. For people who are paying a premium for a life insurance policy, it is important that you do not miss out on the premium and most importantly, do not quit the policy under any circumstances before the tenure. Mentioned below are a few reasons as to why you should never quit a life insurance policy.
- Financial Security to your nominee
As mentioned, we do not have the power to predict our death date. In the event of our unfortunate passing away, a life insurance covers your family financially. A lump sum payout that your family receives upon your death, will allow them to take care of their financial needs. If you quit the plan before the end of the tenure, your family may not receive such benefits.
- Risk Cover
In India, deaths due to accidents are pretty common. In the event, you lose your life in any accidents or mishaps, your insurance policy with its risk cover option will come to your family’s aid. For the benefits your family receive upon your passing away, the premium you are paying is very low.
- Tax Benefits
One of the important benefits of life insurance policies is the benefit of tax deduction. Under Income Tax 80 (C), you can claim a tax deduction upto Rs. 1.5 Lakhs on the premium you pay towards life insurance policy. Under section 10(10D), you are exempted from tax on the maturity benefits.
- Loan
A life insurance policy can help you avail a loan. Loan are borrowed against the death benefit, and the insurance provider uses the policy as collateral for the loan. Loans against insurance policies are becoming a popular choice as the interest rates for such loans are way lower than a personal loan. The interest rates depend on the number of premiums paid. The more number of premiums paid, the lesses are the interest rates. It may help you whenever you face a financial crunch instead of borrowing from banks on hefty interest rates.
- Income after retirement
As many of us are working in private sector, we do not have the luxury of monthly pension. We would require a steady income after our retirement to carry on with our routine. If you are a life insurance policy holder, you need not worry as the company offers you an assured income in the form of annuities. By breaking the policy midterm, you run the risk of losing such benefits.
So, these reasons should suffice as to why you should never quit a life insurance policy. To know more about life insurance policies, visit our website and purchase the plan that fits your budget. Stay insured, stay protected!