Life Insurance :
Life insurance is commonly known as life assurance. It is an agreement between the consumer and the insurer, where the insurance company offers financial protection or coverage to your family so that they can continue to lead a stable life even in your absence. The payment regarding terminal illness and critical illness depends upon the norms of the insurer. The consumer pays a specified premium amount in lump sum or at regular intervals. Here, your life cover premium depends upon various factors such as age, gender and health condition.
Benefits of Life Insurance:
Third Party Liability Coverage: According to the Motor Vehicle Act 1988, it is mandatory to have third party insurance which covers the liabilities the insured party has to pay due to damage or injury occurred to any other individual by him/her. It refers to the minimum risks which are covered under the Auto Vehicles Act 1938. The insurance does not cover any damage being caused to one's own property.
Comprehensive Coverage or package Two Wheeler insurance: In addition to covering the damage done to third party in the form of injury, death or damage to vehicle, our own vehicle also get damaged; rider and his co-passenger also get hurt during any accident. Hence it becomes important to have a comprehensive cover. Many plans also cover:
Peace of mind: It guarantees that a sum assured will be paid by the life insurer to meet future goals of the policyholder or family, in case of any unfortunate event such as death and critical illness.
Tax benefits: : Under Section 10(10D) of the Income Tax Act in India, the maturity benefits offered by life insurance policies are eligible for tax benefits and under Section 80C, the premiums paid on life insurance policy also get tax deductions.
The best way to accomplish your goals: It is a systematic investment where you pay the life insurance premium when due and the life insurance company allocates it against your name. You just need to pay your premium on time and slowly your life insurance policy helps you to increase your corpus and allows you to realize your best dreams without too much effort.
Retirement Planning: The life insurance policy helps build up a corpus for retirement and also provides life insurance cover at the same time with a range of payout options - lump sum payment, annuities, and monthly payments.
What is the ideal time to buy Life Insurance?
You should buy an insurance cover, the minute you have people dependent on you. Anyone who is married and has a family to support should think of purchasing the best life insurance policy. The younger the age, lower will be the premium – So even single persons can choose the life insurance plans to get tax benefits and after marriage, they can add their spouse and children as beneficiary in the insurance contract. Also, there is no age limit to start buying life insurance cover.
How much Term Insurance cover do I need?
Every policyholder should review his plan's features on a regular basis so that it is coherent with the current needs. The amount of life insurance that you need depends on various factors such as marital status, earning power of the person, age in the family. The requirement of having an insurance plan changes every few years due to increment in responsibilities.
So, you should keep these points in mind while deciding Insurance cover:
- Immediate financial expenses that your family may require upon your immediate death.
- Your salary that goes towards meeting present expenses and future needs.
- How long would your dependents need support?
- Money that would you like to save for your child’s education and marriage.
You need to consider a retirement plan for maintaining a respectable living standard and be able to meet the increased medical expenses. It is advisable for you to take the pension plan at an early stage of life; it will help you in getting lower premium amounts. As you secured all your basic and future needs, you would also want to increase your wealth. Judicious financial investment planning can help you in determining the goals related to wealth and the right path to reach it wisely. The life insurance plan that you have can help you in increasing wealth corpus by negating the effects of inflation.
Types of Life Insurance Plans:
Pension Plan: Retirement is an inescapable period of life. Would you want to be dependent on others for your living at the old age? If not, then you should plan for your retirement today itself. Pension Plans essentially help you invest your savings so that it can be used after your retirement. Every individual wants to have a tension free and peaceful retired life after years of hard work. However with the rising inflation and people preferring to live in nuclear families one cannot expect to have a tension free life unless one has accumulated great wealth, inherited a huge sum of money or at least have a retirement plan/pension plan.
Pension plan is nothing but: Investment + Death Benefit + Survival Benefit + Regular Income + Tax Benefits
Child Plan It is very important for every parent to plan for their children's future in time. They want their dreams to be nurtured fruitfully even if we're not around.
A Child Plan
- Financially secure your child's future – no matter what!
- Finance the turning points in his/her life - Higher Education or Marriage.
- Secures both parents’ as well child’s life.
- Also provides with a life cover: Make sure to insure your life also. It is beneficial to buy a plan which has a built in clause premium waiver for future. This would guarantee that the plan continues if you are not there to take care of it and your child would be able to receive assured sum amount at maturity.
- over is obtained irrespective of the state of child’s health on the deferred date
- Offers flexibility to invest in multiple instrument types depending on your risk profile and requirements.
Term Plan: Insurance Only - The simplest and cheapest form of insurance that is designed to offer financial protection for a specified tenure, say 15 or 20 years. However, if you survive the term, the insurer pays nothing. The best thing about a term insurance policy is that the premium is quite low for the insurance cover it provides. Some insurance companies in India also offer a life insurance policy product that comes with a money back guarantee.
Endowment Policy: Insurance + investment (equities and debt) – Some part of the premium is allocated towards the sum assured and the remaining portion of the premium gets invested in asset markets. It pays a lump sum amount after the specified duration or on the death of the policyholder, whichever is earlier.
ULIP - Unit Linked Insurance Product: In ULIP, a portion of the premium goes towards providing the life cover, while the residual portion is invested in equities and debts. The investment portion in ULIP is subject to market volatility. Investing in ULIP inculcates regular saving habit in a person, which is imperative for the creation of wealth.
Money Back Life Insurance: It offers periodical payment of partial survival benefits during the tenure of the policy as long as the policyholder is alive. In the event of death of the insured, the insurance company pays the full sum assured along with survival benefits.
Whole Life Insurance:- Offering the dual benefit of insurance and investment, whole life insurance plans offer insurance cover for the whole life of the person or up to 100 years whichever is earlier. Also the life insurance company calculates bonus on the sum assured, which is paid to the nominee after the death of the policyholder.
Documents Required To Buy Pension Plan
Age proof: Birth Certificate, 10th or 12th mark sheet, Driving License, Passport, Voter ID, etc.(Any one)
Identity proof: Driving License, Passport, Voter ID, PAN Card, Aadhar Card, which proves ones citizenship
Address proof: : Electricity Bill, Telephone Bill, Ration Card, Driving License, Passport, should clearly mention the permanent address
Income Proof: income proof specifying the income of the person buying the insurance
Proposal Form: : duly filled in proposal form is required
Medical Tests: Some companies may require medical check-up in order to make sure that the insured does not suffer from any chronic illness.
Please note that the information provided is collected from sources publicly available & we believe to be reliable. The website doesn't warrant the accuracy, reliability & absolute information available on the website. Participation by site visitors or registered customers is on a voluntary basis. The policies are offered by various life Insurance & non-life insurance offering companies and sarvsurakshit.com does not seek to, either directly or indirectly, advise, offer, solicit or recommend that any person who is or proposes to become its member should purchase the Policy.