Term insurance is a pure protection plan that offers financial coverage in case of an unfortunate incident during the policy term. The primary purpose of a term plan is to provide your loved ones with a financial cushion in your absence. Term insurance offers a high sum assured at relatively affordable costs, enabling you to provide for your family members after you.

Below are some features of term life insurance that can help you understand this product better:

Affordable Premiums

A term insurance plan offers high sum assured with affordable premiums, allowing you to safeguard your family's future without budget constraints. The plan's cost-effectiveness makes it accessible to most income groups and professionals.

Fixed Coverage Amount

One of the key features of a term insurance policy is the fixed life cover`. Term insurance provides your loved ones with a fixed sum assured that is chosen by you at the time of purchasing the plan. This assured amount is paid to the nominees in case of an unfortunate event of death during the policy term.

Term Duration Options

Term insurance offers flexible policy terms, such as 10, 20, 30 years or your whole life. You can select a duration that aligns with your age, professional and personal goals, family's needs and other similar factors.

Additional Riders

Term insurance features are not limited to the basic components of the plan. You also have the option to add riders to the base policy. You can choose from different riders as per your individual needs. These riders enhance your coverage amount and can be added at a nominal cost.

Tax Benefits

Tax^* benefits are one of the lesser-known features of term insurance. The premium paid towards a term life insurance plan can be claimed as deductions subject to conditions prescribed under Section 80C of The Income Tax Act, 1961. Additionally, the payout received by the plan's beneficiary is exempt subject to conditions prescribed under Section 10(10D)^* of the Income Tax Act, 1961.

Who Should Consider Term Insurance

Below are some people who can benefit from purchasing term insurance:

Young families

Term insurance is ideal for young families and allows the primary breadwinner to provide financial protection for the dependents.

People with debt obligations

Term insurance can be a valuable tool if you have debt obligations, such as outstanding loans. The insurance payout can be used to pay off debts and prevent your family members from being burdened with your financial obligations in case of an unfortunate event during the policy term.

Parents

Term insurance can help parents leave a legacy for their children's education and other financial needs in their absence.

Married couples

Term insurance can help the spouse cater to their financial needs and cope with the loss of a loved one. It can be essential for both partners, irrespective of their genders and professions.

Conclusion

Term insurance stands out for its affordability, fixed coverage, flexibility and additional benefits like riders and tax^* benefits. However, it is important to assess your personalised insurance needs to ensure your policy's features align with your requirements and select a plan that best suits you.

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