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The Benefits Of Life Insurance Policy: You Should Need To Know About It

Life Insurance is a very common word I hope you hear about it many times, But Have you ever read about the benefits of life insurance policy and how the insurance can help you and your family in a very bad time of your life?

Insurance is a great product to help safeguard your monetarily in case of any mishaps. We all try to keep our family safe from any unfortunate events that may occur without any intimation. This cannot be cured for life damage, but monetary damage is controllable. Therefore, you should always plan for insurance of all types.

benefits of life insurance policy

Top 3 Benefits Of Insurance Policy:

Before you apply for any insurance, ensure that you have life insurance in place. This would help you to keep your loved ones safe from any damages immediately. The life insurance policy covers your death and the sum assured that you get can be decided by you when you apply for it. There are many types of life insurance and the many ways in which it works. Let us look at them in detail. Some points to be noticed in Life insurance benefit in India :

  1.  Life Insurance Protection:
    Always good for you that is your cash value to collect on your whole life policy isn’t subject to the stock market.
  2.  Life Insurence Cash Value Growth:
    Regardless of any time how to perform stock markets, your cash value grows at a fixed rate. Over time, Your policy Increases your value of money.
  3. Additional Income:
    Under IRC Section 1035, a whole life policy can be exchanged without tax penalties for an annuity, which can provide you with additional income for life.


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Plans Of Life Insurance In India

There are two main types of life insurance policies in India. One which is a

  • Term plan
  • Investment plan

The term plan is quite simple as it is only from an insurance standpoint. Your beneficiaries would get the agreed sum assured in case if you die in the mentioned circumstances. Such policies have a lesser premium when compared to investment policies.

However, it is said that you should not mix investment ad insurance together as you would not the benefit of both any time. The reason is simple, you would get more returns on investment and insurance goes for a toss which was the main motive of the plan. You can buy many investment plans available in the market, but an insurance plan is limited.

The investment plans are more centric to investments rather than insurance. Hence you know which plan is more beneficial to you in the long run.

types of life insurance in India


Types of Life Insurance In India

  1. Term Life Insurance
  2. Whole Life Insurance
  3. Endowment Policy
  4. Money Back Policy
  5. Savings & Investment Plans
  6. Retirement Plans
  7. Unit Linked Insurance Plans – Ulips
  8. Child Insurance Policy

Advantages of Life Insurance Policy

Being a breadwinner of the family, you have certain responsibilities towards your family. This needs to be dealt with well. Life insurance in India has a lot of value as it gives you the money when you need it the most. You may not have done savings at the level at which your family would need it in the future. But with life insurance, this gap can be filled within a single stroke.

Advantages Of Life InsuranceThe best part about life insurance is that it can keep your dependents independent even when you are not around. Life insurance policy information booklet has all the details that are needed when you need to claim it. Therefore, make it a point to keep such documents and policy at a place where your family knows about it. You get a huge corpus at the death of the policyholder. The physical loss cannot be covered but the stress to lead a normal life hereafter is taken care of.

Advantages and Disadvantages of Life Insurance:

There are many benefits of life insurance policy, check them from below mentioned below points.


Advantage  Disadvantage
Life insurance helps to that family with the adverse financial consequences of the insured’s death. Policyholders waive existing expenditure to pay policy premiums. Additionally, life insurance is normally obtained for the benefit of others and mostly only secondarily for the insured person.
Death benefits are generally income-tax-free to the beneficiary that helps to the people. Cash capitulation values are typically less than the premiums paid in the first several policy years and most of the times a policy owner may not pull through the premiums paid if the policy is surrendered.
Life insurance policy is a benefit if Death benefits may be estate-tax free if the policy is owned properly. The life insurance buying decision and the placing of life insurance can be difficult especially if the insurance is for estate planning, business situations or complex family situations.
Life insurance enjoys favorable tax treatment, another financial instrument The life insurance acquisition process can be frustrating and confusing (e.g. is the life insurance agent reliable? Is this the correct product and carrier? How can medical underwriting be efficient?).
Policy loans are income tax-free.

whole life insurance

How To Buy Life Insurance Online?

You can now buy life insurance online using the insurance policy app. This app is a third-party app or a company app from which you wish to buy the insurance. Earlier you had to contact a life insurance agent or visit the office of the company to get the insurance. But now everything is available online. You can find the best available life insurance policy online and buy it as well.

Frequently Asked Questions

Q.What is life insurance?

Ans. Life Insurance is the protection which your family gets in case of the policy holder’s death due to unforeseen events.

Q.What does basic life insurance mean?

Ans. Basic life insurance means that the policyholder will be covered for the sum assured agreed at the time of policy purchase. This amount would be received by the beneficiaries on the death of the policyholder.

Q.What is life insurance and how does it work?

Ans. Life insurance is a cover given to an individual by the insurance company for the loss of their life. It works on the principle of premiums paid for the period mentioned in the policy. If there is a death during this period the terms of the contract have adhered, else the money goes in the company’s profits.

Q.Why should I get life insurance?

Ans. You should get life insurance to safeguard your immediate family from any financial burden when you are no longer into this world.

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