Income from a job, business, or any other source can provide you with financial protection and stability from various liabilities. However, life is unpredictable and it is always better to be prepared for any unforeseen circumstances. This is why it is essential for you to protect your income and safeguard your loved ones against all unfavourable circumstances.
Here are some important things to know about protecting your income with an income protection insurance plan.
What are income protection insurance plans?
Income protection insurance plans ensure that your income is protected so that your family remains secured at all times. These plans financially protect your loved ones in the case of an unfortunate event. It offers them the opportunity to live a comfortable life that is stress-free and financially stable.
Why do you need income protection insurance plans?
Income protection insurance plans are important for multiple reasons. Here are some of their uses:
- Inflation protection: Inflation increases the price of goods and services which means that you can buy lesser items with the same amount of money in the future. With prices constantly rising, it is vital to have a plan that protects your money while retaining its value in the coming years. An income protection insurance plan provides your loved ones with the financial security that can help them deal with the negative effects of inflation
- Ensures constant quality of life: If you (the insured person) are the primary earner in the family, an income protection insurance plan can take care of your family’s lifestyle needs. It can help them continue with the same standard of living as before, in the case of an untimely circumstance. With these plans, your income continues as it was and your dependants get to live comfortably
- Debt coverage: You may have taken some loans, such as a home loan, car loan, personal loan, etc. In addition to this, you could also have credit card dues or other liabilities. The repayment of this debt, in your absence, can become a financial burden for your family. However, an income protection insurance plan offers immediate payouts to settle any outstanding debts that you have accumulated in your life. This gives your loved ones a chance to live their life without worry
ICICI Pru iProtect Smart Plan: The ideal income protection insurance plan
The ICICI Pru iProtect Smart Plan1 provides many benefits so that you and your loved ones do not have to make any compromises with your financial goals in uncertain times. It is cost effective and comfortably fits into your budget with premiums as low as ₹ 3532 per month for a life cover3 as large as ₹ 1 crore. This plan also offers some great riders which are additional benefits that you can opt for. The accelerated critical illness rider4 covers the cost of treatment of illnesses like heart diseases, cancer, etc. The plan also offers an accidental death benefit5 that pays up to ₹ 2 Crore to your family, in case of an unfortunate event due to an accident. In the case of permanent and total disability, the company will pay all future premiums on your behalf, and your cover continues without any change. Moreover, the plan offers tax6 benefits of up to ₹ 54,600 under Section 80C and 80D. The sum assured also qualifies for tax benefits under Section 10(10D), offering your family financial stability in difficult times.
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1 ICICI Pru iProtect Smart offers four variants namely ‘Life’, ‘Life plus’, ‘Life and health’ and ‘All in One’ with difference benefits. “All in One” is one of the four variants offered under iProtect Smart having all benefits offered under other ICICI Pru iProtect Smart variants namely Life, Life plus and Life & health. The customer can choose any one variant from the four available variants. Please refer to the product brochure for more details.
2 The premium for a 18 year old healthy male for a life cover of ₹ 50 lakh for the ICICI Pru iProtect Smart – Life Option under the regular income payout option for a policy term of 40 years is ₹ 405 p.m (inclusive of all taxes). The above premium are for online channel.
3 Life Cover is the benefit payable on death of the life assured during the policy term.
4 Accelerated Critical Illness Benefit (ACI Benefit) is optional and available under Life & Health and All in One options. This benefit is payable, on first occurrence of any of the 34 illnesses covered. Medical documents confirming diagnosis of critical illness needs to be submitted. The benefit is payable only on the fulfillment of the definition of the diagnosed critical illness. The ACI Benefit, is accelerated and not an additional benefit which means the policy will continue with the Death Benefit reduced by the extent of the ACI Benefit paid. The future premiums payable under the policy will reduce proportionately. If ACI Benefit paid is equal to the Death Benefit, the policy will terminate on payment of the ACI Benefit. To know more in detail about ACI Benefit, terms & conditions governing it, kindly refer to sales brochure. ACI Benefit term would be equal to policy term or 30 years or (75-Age at entry), whichever is lower.
5 Accidental Death benefit (ADB) is up to Rs. 2 Crores(Subjected to Underwriting guidelines). ADB is available in Life Plus and All in One options. In case of death due to an accident Accidental Death Benefit will be paid out in addition to Death Benefit. Accidental Death Benefit will be equal to the policy term or (80-Age at entry), whichever is lower.
6 Tax benefits of Rs. 54,600 (Rs. 46,800 u/s 80C & Rs. 7,800 u/s 80D) is calculated at highest tax slab rate of 31.20%(including cess excluding surcharge) on life insurance premium u/s 80C of Rs. 1,50,000 and health premium u/s 80D of Rs. 25,000. Tax benefits under the policy are subject to conditions under Section 80C, 80D,10(10D), 115BAC and other provisions of the Income Tax Act,1961. Goods and Service tax and Cesses, if any will be charged extra as per prevailing rates. Tax laws are subject to amendments made thereto from time to time. Please consult your tax advisor for details, before acting on above.