Importance of Term Insurance for Salaried and Self-Employed

Life is a myriad of experiences, some good, some not so great. You never know what each day will bring, and yet, what makes this uncertainty a little better and easier to deal with is the planning we carry out. Ironing our shirts, packing work bags the night before, keeping the medicine cabinet stocked, having enough food and water at home - are all examples of what we, as humans, do to avoid unpleasant situations that we have no control over.

Term insurance is another part of that preparation, when looked at from a financial angle.

As a salaried or self-employed individual, you most likely are the primary bread-earner of your family, and your loved ones may depend on you for their life goals, day-to-day necessities, and lifestyle. And you obviously want to do everything you can to keep them happy, fulfilled, and secure.

Term insurance helps you with this. It ensures that your loved ones get the same level of financial stability even when you aren’t around to provide for and support them. If you pass away when the term insurance policy is active, the insurance provider will pay your family a fixed sum of money so they can deal with life and its never-ending expenses. Let’s have a look at why term insurance is important for salaried and self-employed people.

Importance of Term Insurance For Self Employed and Salaried People

Here are a few reasons why term insurance is a wise investment choice -

Financial Protection for your Loved Ones

Regardless of whether you’re salaried or self-employed, you may have certain financial obligations towards your family members. You need to make sure that your loved ones are financially afloat and are facing no problems when it comes to their own goals and daily needs. Term insurance acts as an unbreakable safety net that gives your nominee the claim payout to meet everyday expenses, outstanding loans, and more when you aren’t around.

Replaces your Income

Losing a loved one is emotionally traumatic, and when you look at it from a practical perspective, the associated loss of income has a grave impact on the lives of loved ones. They may lose their financial stability and it may get difficult to cope up with bills, outstanding debts, and other immediate expenses, especially if there isn’t another earning member. Term insurance acts as a strong shield, replacing your income, to make sure your family members are financially safe, always.

Repayment of Debts and Liabilities

Whether salaried or self-employed, you may take loans to meet your needs. It may be a business loan, home loan, car loan, etc. Whatever the case may be, if you unfortunately pass away before your loan is repaid, your loved ones will have to bear the entire responsibility of settling it. Which can be extremely hard if there’s no other earning member. Term insurance is a great way to deal with this too. The claim amount that your loved ones will get in the unfortunate event of your demise can be used to pay off any outstanding debts with ease.

It’s Easy on the Pockets

Term insurance is one of the most affordable forms of life insurance, which makes it a good choice for salaried and self-employed individuals, especially those who adhere to a budget. The relatively lower premiums give you a high coverage in return, ensuring that your finances face no burden.

You can Tailor it to your and your Family’s Needs

Term insurance plans give you lots of flexibility as well as customization choices to make the plan truly yours. You can pick the policy duration, the coverage, any riders, how long you want to pay the premiums for, etc. This allows you to build a plan that fits your and your loved ones’ preferences and requirements.

Tax Benefits*

This benefit is a cherry on the top. Term insurance plans give out tax benefits* on both the premiums you pay and the death benefit your nominee receives. -Under Section 80C of the Income Tax Act of 1961, the annual premiums you pay are eligible for tax deductions up to Rs 1.5 Lakhs. -Under Section 10(10D)^ of the Income Tax Act of 1961, the death benefit your nominee gets, in the unfortunate event of your demise during the policy duration, is exempt from taxation.

Looking For Term Insurance? Here You Go!

ABSLI Salaried Term Plan [UIN: 109N141V01] This comprehensive plan is specifically designed for salaried individuals. It offers you the flexibility to tailor the plan that meets your needs. It ensures that you create a strong financial shield for your loved ones, whether it’s for your child’s educational expenses, maintaining their lifestyle, or keeping up with their everyday needs in your absence.

Key Features

• 4 plan options for your unique needs and preferences.
• Life insurance coverage up to the age of 70.
• Various death benefit payout options, like lump-sum or monthly income.
• Extra protection with the built-in terminal illness benefit.

Conclusion

No matter whether you’re a salaried or self-employed individual, term insurance plays a vital role in securing the financial futures of your loved ones. It’s an important investment to make, so they can live their lives in a happy and fulfilled manner. We hope this article helped you understand why term insurance is a crucial financial tool.