Insuring Life: Investment A to Z
Introduction
Everything around you is insured. Be it the vehicle you purchase, the house you live in or even the gadgets you carry. This is because you are worried that something might happen to these belongings of yours that you treasure so much. But then, what about your life itself? What kind of surety do you have about that, the most important ‘belonging’ of yours? This is where Life Insurance comes into the picture. While it may not be able to save you from death, it surely can relieve some of the financial pressure on those you leave behind.
How does it work? Life Insurance is one of the most widely accepted forms of investment across the world. It serves a major dual purpose, one being the monetary guarantee behind the inevitable and the second being tax savings. But all that aside, let
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For example, the older a person is, the lesser the coverage will be and the higher the premiums are. This is a huge disadvantage which is why life insurance should be taken at a very young age to avoid making huge term payments.
The Pros and Cons
There are numerous benefits to taking Life Insurance Policies which can be availed by almost anyone. These are as follows:
• Tax savings arise as the amount insured via life insurance is exempt from taxation and can be claimed as a deduction from total income. This lowers the tax burden significantly. After all, money saved is money earned, isn’t it?
• A reasonable level of security and comfort can be established in knowing that your family will be safe even without you by their side.
• It is an investment option that helps you save money effectively for a long period of time.
• You are also presented with the eligibility to share profits and receive bonuses depending upon the type of plan chosen.
Just like every other option, this one has a couple of negative aspects to it as well. These have been explained as