How do Term Insurance Benefits and Coverage Impact you?

The journey of life has all possibilities and opportunities that need to be lived. It is, however, immensely essential to make certain that loved ones are rightly taken care of, come what may. In this direction, one such effective avenue is a term insurance plan. 

While other insurance plans do differ, a term insurance plan focuses solely on providing a death benefit. In the case of an unfortunate event, your family gets a lump sum amount to meet all expenses, repay debt, and maintain their well-being. 

In this blog, you’ll learn about term insurance benefits and how coverage of a term insurance plan could significantly impact your and your family's future.

Benefits of a Term Insurance Plan 

Understanding these benefits of a term insurance plan will help you make an informed decision to secure your family's financial future:

1. Financial Protection

The major benefits of term insurance include financial security. On your death, your nominees will receive a sizeable amount that could help them not only meet their expenses but also continue to live as they always had. 

2. Protection Against Critical Illnesses

For instance, most term insurance plans offered by various service providers offer the option to add a rider to help them be covered for critical illnesses. These providers offer additional payouts upon diagnosis of, say, cancer or even a heart attack. 

3. High Coverage at Affordable Premiums

High leverage in buying insurance coverage at a relatively low cost is one of the striking characteristics of term insurance. Just for a couple of thousand rupees every year, you can provide financial protection to your family, equivalent to 10 or 15 times your annual income. 

4. Disability Premium Waiver

Most term insurance plans offer accidental disability riders. In case of a debilitating injury, your policy will continue to cover you by sometimes even waiving all future premiums. 

5. Survival Benefit

While pure term insurance doesn't pay any maturity benefit, some of these plans allow for a return of premium feature wherein all the premiums you have paid are returned to you in case you survive the policy term. Some plans feature a regular income option beyond age 60-a sort of annuity that helps you to have a monthly income stream for retirement.

Term Insurance tax Benefits

You get to claim deductions under the Income Tax Act, Section 80C, up to ₹1.5 lakhs per year from the premiums you pay towards your term insurance. Even better, your nominees will receive the death benefit entirely tax-free under Section 10 (10D) since that is when their need for it is most desperate. This is one of the significant features of term insurance tax benefits. 

Following is a table in brief on the significant features of the term insurance policy:

Feature	Description
Affordability	Term insurance plans are popular for their low premium costs, making them accessible to a wide range of people
Long Policy Term	Coverage can be secured from as early as 18 years of age and extended up to 99 years
Flexibility	Premiums can be paid in one instalment, over several years (e.g., 5, 10, 15 years), or throughout the policy term
Add-on Covers	Many additional coverage options are available, such as critical illness cover, accidental death coverage, and child support benefits
Benefit Payment Modes	Term insurance benefits can be received in the form of a lump sum, regular monthly income, or a combination of both
Premium Block Option	Some plans, like iSelect Smart360 Term Plan, offer the option to block premiums for the first 5 years, with the flexibility to increase the sum assured
Retirement Income Support	Certain plans provide an option to receive the sum assured as a regular monthly income after the age of 60

Secure Your Future With Term Insurance Benefits

Term insurance advantages go much beyond providing just a death benefit. There is the right policy to plan for your future and that of your family, cover critical illnesses and even plan for retirement. Moreover, the taxation benefits from term insurance enable you to save on outlays while creating financial security for your loved ones. Along with a credible insurance company like Canara HSBC Life Insurance, you will be able to customise your policy to precise needs so that whatever setbacks life gives you, your family will be in safer hands.