How Beneficial are Income Protection Plans?

Income protection plans are a type of life insurance plans that protect your loved ones in your absence and at the same time let you save your money for a future goal. Also known as a guaranteed income plan, these plans offer a guaranteed payout on maturity and in the event of an unfortunate death, ensure that the aggrieved family members always have a financial cushion to fall back on. Read on to know the benefits of an income protection plan.

Income protection plans can offer the following advantages:

1. They offer life insurance protection: Income protection plans offer financial protection to your loved ones in your absence. In case of an unfortunate incident, your family members receive the sum assured in a lump sum payment. They can use this money to cover their daily expenses or plan for bigger financial goals like higher education, starting a business, marriage, etc. Income protection plans ensure that your dependents get to lead a comfortable life even when you are not around to take care of them yourself.

2. They offer guaranteed income: A guaranteed income plan is a non-linked, non-participating plan that offers you a guaranteed payout on maturity. The maturity benefit can amount to 100% to 150% of the total premiums paid. Moreover, such plans have little to no risk and can be used to save up for several kinds of needs and goals like retirement, travel, home purchase, and more.

3. They are highly flexible: Income protection plans offer many flexible features that allow you to select the policy tenure and premium payment term according to your preferences. You can pay the premiums monthly, yearly, or half-yearly as per your budget. You can also add health riders to these plans to protect yourself and your family against health-related expenses.

4. They offer tax benefits: A guaranteed income plan can help you lower your tax output. The premiums paid towards such a plan can be used for tax exemption purposes. You can claim a tax exemption of up to ₹1 .5 lakh in a financial year under Section 80C of the Income Tax Act, 1961. The maturity benefits of these plans are tax-free under Section 10 (10)D of the Income Tax Act, 1961. Hence, you can save on tax in the present, and your nominee or you get a tax-free payment when the policy matures.

5. They are simple and hassle-free: Compared to other types of investments, income protection plans offer a lot more ease. You can purchase a plan online and start investing instantly. You do not need any investment acumen or consult a professional financial advisor to begin. You also do not have to worry about market fluctuations. All you need to do is pay the premiums on time, and your savings will accumulate over the tenure.

6. They are not heavy on the pocket: A guaranteed income plan is an affordable option that can suit most people and budgets. You can get a high sum assured at comparatively affordable premiums. In fact, these plans are ideal for people from all walks of life who want to save some money for their future.

To sum it up

A guaranteed income plan lets you save your money without any risk. It also offers life insurance protection so that your loved ones never have to compromise on their dreams and goals. They let you save money on tax and the claim procedures are also quick and straightforward.

The PNB MetLife Income Protection Plan is an excellent, guaranteed savings plan that can provide you and your loved ones with financial security and peace of mind. You can check out its features and start investing to reap high returns.

Know more about term plan and term insurance at PNB MetLife.