A life insurance policy is a financial product that helps you provide financial security and peace of mind for your loved ones in the event of your demise. It helps your loved ones by ensuring they have the resources they need to cover their expenses, such as mortgage and children’s education expenses.
In 2022, the life insurance penetration rate in India was 3.2%. This means that only 3.2% of the Indian population had life insurance coverage. There are many different types of life insurance policies available, so you can choose one that suits your need and requirements. Let’s discuss some of the common types of life insurance policies:
Types of life insurance policy
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Term life insurance
This type of policy is limited to a specific period, like ten years, 20 years, and so on. If you rest in peace between the policy terms, your beneficiaries will receive the benefit.
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Permanent life insurance
This type of policy provides coverage of your entire life span. A permanent life insurance policy is like building a cash value that you can redeem at the time of your retirement or for meeting other financial goals.
So now you know the basics, so let’s discuss some examples of how life insurance will help you build a bright future for your loved ones.
How will life insurance help you build a bright future for your loved ones?
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Pay your final expenses
At the time of your demise, your loved ones might have to pay your final expenses, like funeral expenses. Life insurance will help your loved ones in covering these expenses.
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Pay off your mortgage
A simple mortgage loan is the most common type in India. If you have a mortgage, the money received by the life insurance policy will help you cover this mortgage.
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Pay for your children’s education
In the event of your demise, a life insurance policy can help you to pay for your children’s education. A private school charges between 50,000 to 2 Lakh rupees annually. That’s huge!
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Financial security for your spouse
Suppose you are the breadwinner in your family. A life insurance policy helps your spouse in the event of your demise. This ensures that they will be able to support their children.
A life insurance policy is a helpful financial tool that can help you build the right future for your loved ones. Knowing that your loved ones will be financially secure if anything happens to you can provide peace of mind. It also ensures that your loved ones can achieve their financial goals.
Things you should keep in mind while purchasing a life insurance policy
- Before buying any policy, many policy providers are available in the market, so you should look around and compare quotes before finalising the policy.
- Before you purchase the life insurance policy, make sure you are well aware of all the terms and conditions of the policy, like premium payments, death benefits, and surrender charges.
Life insurance is a powerful financial tool that helps you build a bright future for your loved ones. If you are not already covered by life insurance, consider getting a policy today.
