Diwali is the festival of lights, merry and cheer. It dispels the darkness with light and stands for prosperity as well. This festival acknowledges the role of financial security in order to live a fulfilling life. As we welcome and worship Laxmi, the goddess of wealth as part of our festivities, we also express our gratitude for financial stability. In keeping with the spirit of Diwali, it only makes sense that you would be wise enough to ensure prosperity for your family even if something were to happen to you.
This is where life insurance plans feature. If you have been looking for the right time to buy insurance, Diwali would be a good reason to go through with the plan.
Life insurance ensures you or your loved ones never face any difficulty with the debt commitments.
What exactly is life insurance?
Life insurance is an instrument of protection, and sometimes even act as a tool for wealth creation, between the insurance company and the customer. Under this agreement, the insurer guarantees to pay your beneficiary or nominee a pre-decided amount of money in the unfortunate event of your demise during the term of the life insurance plan.
In return for this promise, you will pay a predefined sum of money called premium on a regular basis, the frequency and duration of which can be chosen by the policyholder. The policyholder is also free to decide the quantum of sum assured under the policy.
The amount of premium you pay depends on this sum assured. You can also get additional riders to the policy like critical illness rider or terminal illness rider - these act as protection from specific contingencies.
Why life insurance?
Life insurance can provide with benefits like
We know it is the festive season and no one likes to talk about sadness, but the truth is that mishaps can occur anytime, and it is necessary to be prepared for the unfortunate eventuality of death. Life insurance plans bring you the foremost benefit of financial security for the family or dependents, in times of untimely eventualities like the death of the bread earner of the family.
Though life insurance primarily serves the function of financial protection but depending on the plan you choose, it can also be an effective investment avenue. There are a plethora of savings and pension plans to choose from, that comprise a component of insurance. Some are also dressed as money-back life insurance plans or guaranteed income plans etc. These can also help build a corpus to meet your crucial financial goals. As more evolved life insurance plans are offered, they increasingly cater to the wealth creation goals of financial planning too.
Life insurance plans are known for their tax benefits. Under Section 80C of the Income Tax Act 1961, the policyholder can avail tax benefit on the premium paid towards life insurance plans. Even the amount that your beneficiary receives is entirely tax-free for them. This sum assured amount includes the sum allocated by way of bonus on such a policy paid on surrender or maturity of the policy or in case of death.
Nowadays, life insurance plans can also act as wealth creation or retirement plans, so they are really the harbingers of prosperity in the later years of your life too!
Thus, life insurance plans with solid protection cover and guaranteed returns could come in handy to provide for the uncertainties of life as well as the anticipated expenses.
*Tax benefits are as per the Income Tax Act, 1961, & are subject to amendments made thereto from time to time. Please consult your tax consultant for more details. Goods and Services Tax (GST) shall be levied as per prevailing tax laws which are subject to change from time to time. The aforesaid article presents the view of an independent writer who is an expert on financial and insurance matters. PNB MetLife India Insurance Co. Ltd. doesn’t influence or support views of the writer of the article in any way. The article is informative in nature and PNB MetLife and/ or the writer of the article shall not be responsible for any direct/ indirect loss or liability or medical complications incurred by the reader for taking any decisions based on the contents and information given in article. Please consult your financial advisor/ insurance advisor/ health advisor before making any decision.
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