Life insurance is a contract by which the insurer undertakes to pay an annuity or a capital to a person, the subscriber in return for a premium. This payment is made according to the type of contract taken out.
In fact, in a life insurance contract, two kinds of contracts must be distinguished: an insurance contract in the event of death and an insurance contract in the event of life.
Life Insurance Benefits
Life insurance helps protect families’ financial security when you are not there. It offers peace of mind and security and can help you save on taxes. There are many benefits to life insurance. Let’s take a look at a few of them:
1.The financial security of life insurance policies will help you and your family members financially secure.
You can ensure the financial security of your family by choosing a comprehensive life insurance policy to ensure your standard of life even in the event of your departure.
2.Life insurance Plan for Wealth Creation: They assist to build wealth over time and increase your savings.
Life insurance plans can be used to help you save for the future requirements of your family. They can be used to protect various kinds of risks and objectives.
3.Life insurance investment: Through regular payment of premiums life insurance plans help to instill financial discipline.
They provide unique investment options for all risk types with a variety of options, including unit-linked plans for investment and guaranteed savings plans. endowment programs, and many more.
4.Retirement planning Life insurance products such as the annuity plan, savings plans endowment plans, and others can help you create your retirement savings pool.
These plans provide guaranteed income at the time of maturity, and can assist you in securing your retirement savings with sufficient savings
5.Tax savings Life insurance plans can provide various tax-saving benefits to increase savings.
The cost of premiums is tax-deductible under sections 80C and 80D in the Income Tax Act, 1961. Also, the maturity benefit have an exemption from tax under Section 10(10D) generally.
Life insurance Types in India
There are five types of life insurance in India:
- Term life insurance plan,
- Health insurance plan,
- Endowment plan,
- Annuity plan
1.Term life insurance The term insurance plan offers your beneficiary a set guaranteed amount, in exchange for regular premiums in the event of an incident that occurs during the duration of the policy.
2.Health insurance plans: health insurance plans pay customers who are insured for medical expenses, such as hospitalisation, treatments, surgery and similar expenses that result from illnesses or injuries, or directly pay a specific sum to the insured.
3.Plan for endowment: An endowment plan allows you to create safe savings without risk and safeguard those financial needs of family members during your absence.
4.Plan for unit linked insurance (ULIP): A unit-linked insurance policy provides both insurance and investment within the same policy.
Part of your premium will be put into equity or debtor balanced funds in accordance with your preferences.
The remaining portion is used to protect those you love with a certain amount guaranteed.
5.Annuity plan: An Annuity plan is a form of retirement plan that gives you regular payments in exchange for an investment in lump sum.
In simple terms your life insurance provider pays you a fee in a lump sum and your money is paid back to you in regular installments at any time or after a set amount of time.
The insurance company invests your funds and then returns the earnings earned from it as payments.
What happens to term life insurance at the end of the term?
When the insured is alive at the end of the contract (the duration of the contract is determined at the time of subscription), the insurer must pay him the savings constituted according to the terms set by the contract, that is to say either under in the form of a capital, or in the form of an annuity.
The insurer has a period of 15 days from the end of the contract to ask the insured for all the documents necessary for payment.
Payment must be made within one month of receipt by the insurer of all the documents required for payment.
Note: Beyond this one-month period, unpaid sums automatically generate interest at double the legal rate for 2 months then, at the end of this two-month period, triple the legal rate. .
Please note: contracts can be renewed at the end of the term, consult the general conditions of your contract or ask your advisor for more information.
What is terminal illness in term insurance?
Financial assistance for you at the end of your life. If you are diagnosed with an incurable terminal illness and your life expectancy is less than twelve (12) months, you can obtain payment of an early benefit by submitting a request to Viaction Assurance, accompanied by documents proving this. condition.
What is Term Life Insurance?
The term life insurance is a protection insurance which aims to ensure a capital or an annuity contract to beneficiaries designated by the policyholder in the event of his death.
Temporary death also guarantees income in the event of the subscriber’s disability. The contract is only valid for a specific period.
What is terminal illness in term insurance?
Financial assistance for you at the end of your life. If you are diagnosed with an incurable terminal illness and your life expectancy is less than twelve (12) months, you can obtain payment of an early benefit by submitting a request to Viaction Assurance, accompanied by documents proving this condition.
What is the best life insurance policy?
The choice of life insurance cannot be made solely on the basis of its rate of return because the markets fluctuate. Other parameters should guide your choice. What are the criteria to consider?
The market is capable of both the best and the worst. You have to be very selective before you start investing for the long term and not hesitate to be unfaithful: your usual advisor will not be able to compete with the best life insurance policies on the market.
What life insurance do i need?
You do not know how to choose your life insurance? Term life insurance plan, Health insurance plan, Endowment plan, ULIP and Annuity plan: which of these types of insurance matches your needs and goals? Here’s everything you should know before making a decision.
Thinking about getting life insurance? It’s a great way to protect your family financially.
In short, life insurance pays an amount to your family or beneficiaries in the event of your death. They can then use the money received to pay:
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