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How to Secure Your Parents’ Future Financially with One Year Term Life Insurance

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You may build a plethora of financial goals and plans in your lifetime. But life is unpredictable. An untimely demise can not only disrupt these ambitions, but it can also leave your family financially stranded. While no amount of money will compensate for the loss of a loved one, one year term life insurance can financially cover your family in your absence.

Besides securing your family during the hard times, a 1 year term insurance plan also provides tax benefits and many other additional benefits that you can leverage during the tenure. Let's find out how a one year term life insurance  can benefit you and your loved ones-

Benefits of One Year Term Insurance Plan

Financial Assistance: One Year Term Insurance plan can secure the future of the policyholder's family by providing death insurance in the event of the policyholder's death. In such cases, they protect dependents such as the policyholder's children, spouse, or elderly parents from having to shoulder the financial responsibilities of the deceased.

This advantage is especially important for newlyweds or new parents, as well as businessmen who have significant debts or other financial obligations. Payments may be made on a regular basis or in one fixed amount after making a claim. The amount can be used by the deceased's family to fulfil their regular needs and also to finance future endeavours like a child's education, marriage etc.

Affordable Premiums: 1 year Term insurance policies are one of the most cost-effective types of life insurance available. They offer significant coverage amounts at a lower cost than conventional life insurance plans. This is mostly due to the shorter tenures of such plans, which can only be renewed regularly.

Flexibility: In circumstances where a policyholder has taken some sort of debt such as a loan, the one year term life insurance  policy will help to decrease the degree of coverage during the tenure. When loans are gradually repaid during this period, the coverage also decreases. While some plans may also offer you various investment options that will create an income over a period of time and are added to your final payout.

Tax Benefits: Under Section 80C of the Income Tax Act of 1961, premiums charged on term plans are tax-deductible up to a maximum of Rs 1.5 lakh per year. However, death benefits are entirely exempted from tax under Section 10D. The tax benefit but this varies depends on a variety of factors such as premiums on lapsed policies may or may not be available for tax deductions, so it's important to renew policies before they expire.

Advantage for Early Buyers: If you decide to invest when you are still young, you will be able to reap a variety of benefits. But as you get older, you will get a lower premium. Buying an insurance policy when you're young means that you will get higher coverage at a lower price. At this stage, 1 year term insurance plan is one of the most cost-effective investments you can make. You get higher returns by paying a small premium.

Additional Riders/Coverage: With a rise in lifestyle disorders, it's becoming more important than ever to invest in riders like disability insurance, cancer insurance, and injury insurance. These riders are purchased in addition to the term plan and provide coverage in the event of a serious medical condition or other unforeseen circumstances.

The Way Forward

Life is uncertain, and if an unfortunate incident occurs, your family will be distraught both emotionally and financially. However, if you have a 1 year term insurance policy or a one year renewable term life insurance, you will be able to alleviate some of their burdens. It is important to purchase a policy that will cover your loved ones' expenses when you are not around anymore. Additionally, with one year term life insurance, you need not worry about your parents' financial security.

Remember to evaluate your monthly expenses, your existing lifestyle, and future activities such as your child's education before fixing the guaranteed amount.

Disclaimer:

The article is meant to be general and informative in nature and should not be construed as solicitation material. Please read the related product brochures for exclusions, terms and conditions, warranties, etc. carefully before concluding a sale.

Consult with your financial advisor before making any decisions on insurance purchase.

*Tax benefits are as per the Income Tax Act, 1961, and are subject to any amendments made thereto from time to time

Suggested Plans

Bharti AXA Life Flexi Term Plan

  • Covers Critical illness at the age of 75.
  • Option to select between Comprehensive cover or Major illness cover
  • Flexible benefit payout option. Payout options based on your financial requirements– a) Lump sum or b) Increasing Monthly Income or c) Lump sum plus Increasing Monthly Income.
  • Tax benefits on the Premiums paid and payout benefits received.

Bharti AXA Life Shining Stars

  • Non-linked, non-participating limited pay endowment Life Insurance plan
  • Designed to take care of the financial needs of your child.
  • Flexibility to opt between 2 Maturity Payout Options
  • Flexibility in Policy Term/Premium Payment Terms
  • A great short-term investment option for a child insurance policy.

Bharti AXA Life Flexi Term Pro

  • Get insurance on your own terms with Bharti AXA Life Flexi Term Pro. #DoTheSmartThing