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Kotak e-Term Plan is a pure term plan that provides a high level of protection to your loved ones in your absence.
Kotak e-Assured Savings Plan not only provides affordable protection but also helps accrue wealth for accomplishing your upcoming financial aims by giving guaranteed benefits.
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The market is flooded with a plethora of life insurance products. There are numerous insurance plans available namely endowment plans, whole life insurance plans, annuity plans, and money plans, among others. Each of these insurance plans has a different financial goal, which may vary from individual to individual.
One of the most common and popular type of life insurance plan is a term policy. As the name suggests, such a life insurance product offers coverage for a certain period. In case of an unfortunate event of death during the term of the policy, the insured’s loved ones will be paid the death benefit.
The death benefit amount may be used to cover income loss, in case the policyholder was the breadwinner of the family. Besides, it may be used to cover unpaid debt as well as meet other financial obligations.
It is important to note that there is no maturity benefit in a term life insurance plan. This means that in case you the term of the policy, no benefits are paid. Such a plan offers only coverage against an unfortunate event of death, and hence such a plan is known as a pure life cover.
The good news is that insurance providers charge a low premium amount for term plans. In fact, premiums charged for this type of insurance is the lowest among all other types of life insurance plans. This is because the entire amount is used to cover risk and is not used for further investment.
There are numerous advantages associated with the purchase of a term life insurance scheme. Most importantly, you may avail of a higher life cover due to affordable premiums. It is important to choose the sum assured amount based on your family’s lifestyle needs. You may go ahead and opt for a higher coverage amount at an affordable rate.
Term plans offer additional coverage through numerous add-ons, known as riders. Some of the most common riders that are offered with term plans include partial or permanent disability rider, waiver of premium rider, critical illness rider, and accidental death rider, among many others. You may analyze the features and benefits of such riders and opt for the ones that are suitable to your needs. By doing so, you may enjoy additional coverage at a nominal cost.
Insurance providers also provide innovative benefits when it comes to term plans. Some insurers offer discounts to non-smokers, while some provide lower premiums to those who purchase term plans through the Internet. Since the cost of paperwork is reduced while purchasing an online term plan, insurers pass on the benefit of low cost to their customers. You may therefore opt for an online plan, and save a significant amount of money.
A major advantage of investing in a term insurance policy is the tax benefit offered by the Income Tax Act, 1961. This act offers numerous exemptions and deductions so as to reduce tax liability for tax payers. You may therefore avail of such deductions and lower your taxable income to a great extent.
Term plans provide tax benefit offered under Sections 80C and Section 10(10D) of the Income Tax Act.
You may avail of tax deduction on the premium paid towards your term plan under Section 80C of the Income Tax Act. This includes premiums paid for yourself, your spouse, and your dependent children. The maximum amount that you may enjoy tax benefit under Section 80C is INR 1.5 lakh.
There are certain clauses for deduction under this section. These include:
Members of Hindu Undivided Family (HUD), along with individuals, may avail of the tax benefits under this section.
Besides saving tax through premiums, the insured may avail of tax exemption on the death benefit amount. In case of an unfortunate event of death, the policyholder’s family / nominee will be entitled to receive the death benefit. Section 10(10D) states that this death benefit amount is totally exempt from tax. This benefit may therefore be availed of by the beneficiaries to reduce tax liability. The good news is that there is no upper limit on the tax benefit.
This clause, however, is not applicable under the following circumstances.
You may reduce your tax liability through a term plan in the following manner.
Indeed, out of the numerous tax-saving options, one of the most effective one is a term plan. Not only does such a policy help to reduce your tax liability, but it also offers financial protection to your loved ones against life uncertainties. The death benefit amount may be used to meet education expenses of the insured’s child or to pay off any outstanding debt. Besides, the amount also acts as an income replacement in case the policyholder was the only earning member of the family.
Purchasing a term plan therefore provides peace of mind, knowing that your family’s financial needs will be taken care of during unforeseen circumstances. You may therefore invest such a plan at the earliest and secure your family’s future.
Kotak Single Invest Advantage is a hassle-free unit linked plan, where you invest once and reap the benefits throughout the policy term.Know more
Kotak e-Term Plan is a pure term insurance plan that provides a holistic life protection at affordable prices. Find out the eligibility criteria, key ...Know more