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Various Advantages of Insurance

Life insurance offers you dual benefits of security and savings. The following advantages explain why life insurance should be an integral part of your financial plans.

  1. Risk Cover-Today life is full of uncertainties, so in these circumstances life insurance ensures that your loved ones would continue to enjoy the good quality of life even when you are no more.
  2. Protection against increasing health expenses – Life insurers through stand alone health insurance plan or riders plans offers the protection against hospitalization expenses and critical diseases. These benefits assume importance considering sharp increase in the incidents of lifestyle diseases and associated medical costs.
  3. Safe long-term investment – Insurance is a highly regulated sector, and with IRDA, its regulatory body at the helm, various rules and regulations ensure the safety of policyholder’s money. Being a long-term saving instrument, insurers concentrate on long term gains and avoid taking any risky decisions for short-term gains.
  4. Builds the habit of thrift – In life insurance, the policyholders pays a fixed amount towards their policy at defined periodicity. This also builds a habit of long-term savings. With regular savings over a long period also ensures that you have decent corpus for addressing your financial needs at different stages of life.
  5. Mortgage Redemption- Mostly, insurance also offers cover to the loans and mortgages taken by the policyholder so that in case of unforeseen circumstances, there is no burden of repayment on the loved ones.
  6. Assured income through annuities – You can effectively plan your retirement with the help of life insurance. The money that you save during your working years will provide you steady and reliable source of income during your retirement years.
  7. Growth through dividends – With traditional life insurance policies, you can easily participate in economic growth without taking any investment risk. The income is distributed evenly among the policy holders through dividend/bonus announced every year.
  8. Protection and savings over a long term- As traditional policies are viewed both by their distributors and investors as a long-term financial commitment, they help the policy holders in meeting their dual needs for long term wealth creation and protection in an efficient way.
  9. Tax Benefits – Various insurance plans offer attractive tax-benefits both at the entry and exit under various plans.
  10. Get loan without affecting the policy benefits – With insurance policy, you also have a option to take loan against the policy. This can help you in meeting your financial emergencies without affecting the benefits of the policy in any way. This is a much better option than seeking a collateral based or an unsecured loan.
  11. Planning for future – Life insurance not only offers financial support to your family in case of your death but also acts as a long-term investment tool. It can also help you in meeting your goals, be it your kids education, marriage, building your house, or planning for your retired life. Traditional life insurance policies, such as traditional endowment plans have defined maturity benefits and built-in guarantees through various product options such as Guaranteed Cash Values, Money Back, and Guaranteed Maturity Values.

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