Term Insurance For HouseWife

Life is a journey, full of new experiences and unknown paths. It is up to you to plan and prepare for whatever comes your way, and to be flexible enough to adjust to the changes that inevitably come. Should you pass away suddenly, your family will be left in an emotional and financial bind - especially if you are the sole breadwinner of the family. But have you ever considered what impact your wife's absence will have on your family?

Women often play the role of both provider and caregiver, demonstrating strength and resilience in the face of adversity. The absence of a wife, whether she is an earning member or a stay-at-home spouse, can be detrimental to the family. The lack of a supportive partner can lead to an increase in stress and financial burden.

Moreover, with the increasing number of illnesses among females, including breast cancer and PCOS (Polycystic Ovary Syndrome) and increasing healthcare costs, the importance of term insurance for your wife cannot be overstated. So, purchasing term insurance for yourself and your wife is the most sensible and economical solution to ensure the financial security of your family - in the face of an eventuality.

In this article, we will discuss how term insurance for a wife is a good decision.

What Term Insurance Is

A term insurance plan is one of the easiest ways to ensure that your family is protected from financial worries in your absence.

If you pass away during the policy period, the insurance provider will pay a sum of money to your loved ones. This sum of money, known as 'sum assured', serves as a lifeline to help your family continue with their dreams and lifestyles even when you’re not around. Your loved ones will receive the money as per the claim payout option you choose while buying the policy.

However, term insurance is a pure risk insurance cover. So, if you survive till the end of the policy duration, no benefits will be paid to you.

Why Should You Buy Term Insurance For Your Wife?

Here are some of the reasons why it is essential to buy term plan for wife -

1️. Provides Financial Protection Women are often the ones making the day-to-day decisions about how money is spent and managing the household budget, regardless of whether they are primary breadwinners, co-breadwinners, or stay-at-home spouses. They play a key role in the financial health of their families. By purchasing term insurance for spouse, your family will remain financially secure in the event of her passing. The sum assured can help your family deal with financial difficulties and pay for basic expenses, such as hiring additional help, managing your household, supporting your children's education, etc. It can provide the surviving family members with the financial means to help them adjust to their new lifestyle and continue to support themselves.

2️. Affordable Premiums Term life insurance charges lower premium than other types of life insurance. Its affordability is largely driven by the fact that it lacks an investment component since the plans do not offer maturity or survival benefits. As such, this makes it an ideal option for those looking for financial protection for their family without breaking the bank.

3️. Highly Customisable: A term insurance policy can be tailored to fit your family's needs and your budget. It's like ordering a custom-made suit from a tailor - you get to choose the material, the design, the size, the colour, the buttons, and the stitching, all according to your preferences.

There are various customisation options available with term insurance, including premium payment frequency, premium payment model, claim payout options, riders, etc. For instance, you can increase your sum assured by opting for the 'Increasing Cover Option’ which increases your cover amount by a specific percentage till a predefined limit is reached. It is possible to tailor your term insurance policy to your exact needs and requirements, providing you with greater control and flexibility.

4️. Offers Peace Of Mind Losing a wife and mother can be very emotionally draining for a family. Not only will they have to cope with the loss of someone who was a source of support and love, but they will also have to adjust to life without that person and figure out how to fill the gap they left behind. Grieving can be overwhelming and financial concerns can exacerbate it. With term insurance, your family will have peace of mind knowing that there will be atleast financial protection in place in the event of an unfortunate circumstance. By providing such financial security, it can help alleviate the financial struggle and provide a sense of stability for the bereaved family.

5️. Offers Dual Tax Advantages* The Income Tax Act of India, 1961 along with its subsequent amendments thereof provides tax benefits¹ for both premiums paid and benefits received under term insurance.

• Section 80C allows you to claim tax deductions on term insurance premiums up to Rs 1,50,000.

• Additionally, the claim amount the family will receive if the demise happens during the policy term is exempt from taxation under Section 10(10D)^.

What Kind Of Term Insurance Plan Should Your Wife Have?

In today's market, term insurance plans come in many forms. If you plan to buy a term plan for spouse, an individual term insurance plan (regular term insurance plan) or a joint term insurance plan, also known as spouse term insurance, may be worth considering.

1. Single Term Insurance Plan

Whether your wife is employed or a stay-at-home spouse, you can buy a separate term life insurance for her to ensure your family's financial security in case she passes away during the policy term. Your family will receive a predetermined sum assured as a death benefit. It can be used to provide your family with financial security and the necessary means to move on.

2. Joint Term Insurance Plan

Joint term insurance, also known as spouse term life insurance, covers two individuals under one policy. In this plan, you are the 'primary life assured', and your spouse is the 'secondary life assured'. In case you want to add your non-working spouse to the policy, the insurance company will require your income documents for the verification process.

A Joint Life Term Plan can either have a separate or a shared sum assured. Let’s look at how the plan works in both cases.

• Sum Assured Is Separate The cover amount of your spouse, i.e., the secondary life assured can either be:
• Same as your cover amount or
• A percentage, like 50% or 25%, of your cover amount.

This will vary depending on the insurance company you buy from. In the event, you or your wife passes away during the policy period, the surviving spouse will receive the cover amount. Should the surviving spouse also pass away during the policy period, the nominee will receive the cover amount.

• Sum Assured Is Shared Under some joint life term insurance plans, both the life assured will have the same cover amount and the claim is made on a first-death basis. This means that the insurer will pay the claim amount upon the death of either of the spouses and the policy will terminate.

Note: The terms and conditions, limitations, etc. as associated with joint term insurance policies can vary across insurance companies.

Wrapping up!

From taking on leading roles in business to championing social causes to handling household duties, women are making an impact in every aspect of the society. So, as a responsible partner, it is essential for you to secure your wife with term insurance. It is an effective way to protect her and provide a stable future for your and her loved ones. It gives her the security and assurance that her family will be taken care of in any circumstance in her absence.