Accidents and misfortunes are the key indicators that show how fragile human life can be and the need to ensure our lives against such risk. Life insurance is a crucial tool to provide you with a sense of security that your family will work torwards accomplishing their goals, in case something happens to you.


It is a protective cover that safeguards their financial needs so that they don’t have to be dependent on anyone. If you do not take this necessary life cover, your dependents will not only have to deal with the emotional loss of losing you but also deal with the financial void caused due to loss of income.


This is the reason that it is vital to use the life insurance company as it is necessary for families to feel secure and confident that they are in safe hands, even in the face of any eventuality.


A life insurance policy is a contract between you and an insurance company that promises to pay the nominee sum assured in case of your demise within the policy term. To ensure that the claim process flows smoothly, you must read all the life insurance details before signing the contract.


If you are satisfied with your policy, then you can also check for riders to customize the life insurance as per your needs and lifestyle. These add-on benefits can make your policy more comprehensive and personalized.


Still wondering about why life insurance policy is a crucial financial instrument in your financial portfolio? Read on to know its key benefits that help you beat uncertainties and support your goals without disrupting your life.


  1. Financial Protection For Life


Your life insurance policy will ensure that your family receives financial support from your insurance provider to get by life, in case of your sudden demise. The insurer will pay the sum assured to the policy nominee, known as a death benefit. They can use this amount to pay for their day-to-day expenses and also fund your child’s education as well as meet other financial goals that you had decided together. Almost everybody can benefit from a burial insurance policy, that would cover your final expenses at the end of one’s life.  Many popular insurance providers such as Mutual of Omaha, American General, and Transamerica offer affordable plans.  There are many online resources such as that can help provide information to families.


  1. Wealth Creation Opportunities


Life insurance policies are a comprehensive product that offers dual benefits of insurance and investment. While one half of your premium is pegged towards your life cover, the other half is invested in different market-linked equity and debt instruments. You can ensure that your money is allocated into fund options that provide maximal returns while taking care of inflation and market volatilities. However, you must assess your risk appetite and read all the life insurance details before investing in the financial instrument to build a suitable portfolio.


  1. Cost Effective Premiums


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Life insurance is often falsely believed to be expensive. However, if you are worried about the costs and only want the life risk cover, then term policy will offer you extensive coverage at a surprisingly affordable premium. Online term insurance plans from reputable insurers such as Max Life Insurance enable you to make an informed buying decision by reviewing, comparing and selecting policies that provide maximal benefits at cost-effective premium amounts. These plans also allow you to make the purchase quick and hassle-free.


  1. They are Tax-free Instruments


When you invest in life insurance policies, you save taxes throughout the policy term under section 80C of the income tax act. Additionally, even the payouts given to the beneficiaries are tax-free. When you are calculating the sum assured to work out your family’s future requirements, you can do so without worrying about the dynamic tax landscape because your returns are tax-free!


  1. It Makes You Think About Mortality


Nobody likes to think about their passing. However, it is an unavoidable reality, and it is better to think about it now than later. If you want to ensure your family’s sustainance and protection against the financial hardships, then you must investin a life insurance policy now will take that worry off your hands. It is also worth discussing your family’s lifestyle needs and future expenses, such as your child’s education abroad or daughter’s marriage. A life insurance policy not only makes you think about mortality but also instigates you to plan your financial future at the right time.


  1. Coverage Against Liabilities


When you want to fulfil your financial goals, you are going to take several loans to support those goals, such as buying a house or paying for an expensive education abroad. But imagine if something were to happen to you while the loan is still active? Who will pay the remaining EMIs? Who will bear the burden of these liabilities? Thus a life insurance policy ensures that your family has the financial means to meet the loan repayments, even when you are not around to pay for them anymore.


As you can see, life insurance is a necessary tool to safeguard your family’s financial interests in the future. With a wide range of policy variants, you can not only protect your loved ones against life’s eventualities but also opt for life insurance coverage with an in-built investment component to grow your wealth over time, thereby securing your future as well.


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