'Life is uncertain; death is certain,' said Gautama Buddha. That is why getting life insurance is a responsibility. If you are the sole breadwinner in your family, the responsibility doubles. Life insurance is not just a financial decision but also an emotional one. Here are some reasons why you should buy life insurance.
Your family would face emotional stress in the event of your sudden demise. You can prevent a situation where you family worries about finances in times of grief. Your dependents would all take some time to get on their feet. It is your responsibility to provide for their needs during the transition phase.
To manage debt
Your family would have to pay off your financial liabilities after your death. Or, the lender may confiscate the security you had provided for the loan. You could prepare for this, though. You could plan for your debts to be repaid from the money received from the life insurance policy. Do not let your debts become a burden on your family.
For children's education and marriage
Had you been around, you would have secured your children's future. But you can plan for it from today. The cost of education is rising. Through your life insurance policy, you can ensure that your children get the best education. You could even use a part of the sum assured to create a wedding fund for your kids.
To meet long-term goals
You would have to invest monthly or annually in life insurance over the long-term. Some policies provide a dual benefit. They give returns after a certain period and upon the death of the insured. These policies are linked to investments. So, you receive a dividend as well. You can use the money received from this insurance to fund your retirement, a dream home, or even a world tour.
For tax benefit
Life insurance helps you save tax. The premium paid for a policy gives you a tax benefit of up to Rs 1.5 lakh. This applies under Section 80C of the Income Tax Act. The sum assured received on the death of the insured is also tax-free under Section 10D. Are you looking to invest for the long term and save tax? Investing in life insurance is a smart choice in that case.
Peace of mind
Death is certain but the timing is not. Any serious accident or a sudden health issue can lead to a loss of life. With life insurance, you can mitigate the risk of leaving your family without any financial support. This is a necessary financial safeguard for your family. Knowing you have a life insurance policy will give you peace of mind.
Donate as a remembrance
You can use life insurance to give back to society and help those in need. Sure, you can do charity while you are alive. But another alternative is paying a minimal premium every year. Then donate a lump sum amount from your life insurance when you are no more. This could be a sizable sum.
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