What is Life Insurance? Why Should You Buy One to Meet Your Needs?

Let us first understand what is life insurance? Life insurance is a financial cover that you can purchase for any contingencies linked with human life, such as disability, death, accident, or even retirement. This cover safeguards your family from any loss of income that would incur in the household on account of any above-mentioned unfortunate events.

Now we will go through why life insurance is needed, and what purpose does it serve? Some of the main benefits of life insurance are as below:

• Family’s Financial Security
  The primary importance of life insurance is the financial safety net that it provides to your family post you’re gone. Your family is dependent on you, and the proceeds from this life insurance will help them to meet any financial obligations that may befall upon them such as children’s education, repayment of the debt, replacing lost household income, etc. 
  
  
• Debt Repayment
  In your absence, loan companies approach the nominee to collect any outstanding debt pending from your end. This is applicable for a car loan, home loan, personal loan, and so on. To avoid your family getting entangled in this financial stress, life insurance provides a way out to repay any outstanding amounts.
  
  
• Achievement of Long-Term Goals
  Believe it or not - Life insurance aids in the achievement of long-term goals. Several life insurance plans provide you with dividends and options to invest part money into equity and debt markets, which give you attractive returns. These additional forms of income can aid in the achievement of your goals, such as the purchase of a home, retirement, etc.
  
  
• Buy When You Are Young
  It is always advisable to buy life insurance when you are young and free of any dependents and of good health. Coverage costs are much lower when you are young, which ensures lower premium for you. Purchasing life insurance at that age can aid in numerous benefits such as inculcating the investment and savings habit, make you more responsible, and better at money management.
  
  
• Keeps You Retirement Ready
  There are several life insurance schemes that have attached riders pertaining to retirement. Under these plans, you can rest assured to have a steady flow of income every month. So, investing in a good life insurance product can go a long way in aiding your retirement.
  
  
• Tax Saving
  All premiums payable under a life insurance plan are eligible for tax deduction up to ₹1.5 lakh under Section 80C of the Income Tax Act, 1961. Further, tax-free proceeds on maturity or death under Section 10(D) also adds to your tax-saving component.
  
  
• Compulsory Savings
  Saving for the future is always a good decision which most of us don’t think about. When you buy life insurance, you make a compulsory commitment to pay premium regularly for you and your family’s future. Further, depending on the plan, these extra amounts invested accrue cash value which will be beneficial for you in the future. Another importance of life insurance is that you can avail loans against it.
  
  

It is a known fact that the more we age, the more it gets difficult to obtain a life insurance or competitive premiums. We become more prone to ailments and illnesses on account of likely health deteriorations. Further, the purchase of life insurance provides us with immense peace of mind which all of us want. We know death is inevitable, so why not make provisions for your family’s future at the earliest. Even a small policy can go a long way in helping your family tide over difficult times.

Visit PNB MetLife to know more about Long Term Savings, Term Insurance & Term Plan