What are Family Term Insurance Plans?
A family term insurance plan is a legal contract between the policyholder and the insurance providing company. This insurance plan offers a lump-sum amount of corpus in case of an unforeseen and unfortunate event, such as an untimely demise of the policyholder.
In such a scenario, if you are not around to provide a financial backup to your family, the family term insurance plan will provide financial security to your loved ones and ensure that they do not face any financial constraints.
What are the Benefits of Investing in Family Term Insurance Plans?
The benefits of investing in family term insurance plans are as follows –
1. Financial Security
One of the key benefits of investing in family term insurance plans is that it provides your family and you with financial security in the times of the rising cost of inflation rates. Moreover, in the worst-case scenarios, if you meet an untimely demise and are not there to provide a financial safety net to your family, this may create a financial and emotional drawback for them. Investing in a family term insurance plan will ensure that they do not face any financial struggles and continue with their lives without hassles.
2. Tax Benefits
A family term insurance plan comes with lump-sum tax deduction benefits. The premiums you pay for this insurance plan are eligible for tax deductions of up to Rs. 1.5 lakhs in one financial year under Section 80C of the Income Tax Act, 1961. However, these laws are subject to change from time to time.
3. Helps in Achieving Yours and Your Family's Short-Term Goals
We all have different short-term goals. Some of us might have goals such as your child's education, paying off a loan or a debt, etc. Investing in a family term insurance plan helps you fulfil your short-term goals without having to face any financial constraints.
4. Premiums are Affordable
Investing in multiple insurance plans to avail additional benefits and a larger corpus can be hectic and confusing. A family term insurance plan offers the benefit of choosing additional rider benefits. This not only offers numerous additional benefits but also increases the life cover as well. You can opt for multiple additional rider benefits, such as Waiver of Premium Rider Benefit, Critical Illness Rider Benefit, Accidental Death Rider Benefits, etc. Please note that riders are not mandatory and are available at additional cost.
Group Life Insurance
You now know everything about what a family term insurance plan is and what are its benefits. It is important to have a financial corpus ready in advance so that you and your family can have a peaceful and seamless future. So, if you are planning to invest in a family term insurance plan, you should go for a reliable insurance company with impressive claim settlement ratio.