Life insurance can be defined as a contract between an insurance policy holder and an insurance company, where the insurer promises to pay a sum of money in exchange for a premium, upon the death of the insured person or after a set period. It is important as it protects from your family and lets you leave them a non taxable amount at the time of death. Insurance provides risk coverage to the insured family in form if monetary compensation in lieu of premium.
These policies are also cover hospitalization expenses and critical illness treatment. The average penetration and density of life insurance is measly 2.76%. There have been improvements in this arena but overall the growth has been rather slow in India.
When can the LIC premium be paid? You can pay the premium up to 30 days before and 30 days after the due date, otherwise you will be charged additional fees.
The benefits of life insurance are looking after your loved ones even after you re gone. This is the most aspects of life insurance one needs to factor it. Your family is dependent on you even after you are gone and you don’t want to let them down. It deals with debt; you don’t want your family to deal with financial liabilities during a crisis. Any kind of home loan, auto loan, personal loan, etc can be taken care of you happen to buy the right insurance policy.
It helps in achieving long term goals, it would help you achieve your long terms goals such as buying a home or planning your retirement. Life insurance supplements your retirement goals to ensure you have a regular stream of income every month. Every millennial needs a life insurance policy. If you haven’t created an emergency fund then created it for you future safety. You could save taxes with insurances policies irrespective of what plan you buy. Death is unavoidable the least you can do for your family is to secure their financial future.
Loan Against LIC Policy affect Credit Score?
But if you a LIC policy in your name, you also have a better option of loan as you can take a loan against this policy. The good thing about this loan is that it does not affect your CIBIL score. Apart from that, the interest rate is also lower than personal loans.