Exploring the Family Term Insurance concept
Ensure your family's financial security with term insurance. Here's what you need to know
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When you start planning for your family's future, be sure to add a life insurance policy to your financial portfolio. With a Term Insurance (TI) policy, you and your family will be financially covered for the duration of the policy. If you pass away unexpectedly, your family will receive an amount known as the death benefit. This is also known as Family Term Insurance as the family benefits from the coverage. Read ahead to learn more about this concept.
What is Family Term Insurance?
A Family Term Insurance policy is a concept where the policy protects your family financially in case you pass away. It offers you affordable premium payments and enables you to customise your policy with add-ons/riders. Certain riders offer benefits including maternity coverage, long-term illness, or accidental death.
With a Family Term Life Insurance Plan, you can ensure peace of mind knowing that your family is financially protected in case of your sudden death. Term Insurance offers coverage for a set number of years. You can opt to migrate to a Whole Life Insurance policy at a later date, or extend your Term Insurance policy when it finishes. Note that Family Term Insurance is also known as Family Term Life Insurance.
What are the features of Family Term Insurance?
A Family Term Insurance policy offers you and your family valuable features from affordability to life cover. The following are a few of its features.
Life cover
A Family Term Life Insurance policy provides your family with a pure life coverage feature. This means that your family is guaranteed financial coverage from your death benefit to help them get back on their feet and keep your home running long after you're gone.
Affordability
Family Term Life Insurance Plans offer your family pure life coverage and are easy to buy as they are active for a few years at a time. Lower premiums mean lower costs, making this policy a great starting point for first-time insurance seekers.
Flexible term
A Family Term Life Insurance plan provides you with a range of years in coverage that suits you and your family. You can always renew the policy before it ends or choose to move over to a Whole Life Insurance policy. You can also choose add on benefits with Term Life Insurance riders. The flexibility this plan offers is suitable for most families' needs and requirements.
Riders
In Term Insurance, a rider is an add-on that you can buy separately. You can customise your Family Term Life Insurance policy with riders suitable for you and your family's lifestyle and requirements. There are riders such as maternity coverage, to cover illnesses, accidental death, disability and more.
What are the benefits of Family Term Insurance?
Read on to find out more about the useful benefits of buying Family Term Insurance.
Financial security
A Family Term Insurance policy guarantees your family's financial security in case you pass away. Your family will receive an assured amount either in a lump sum payout, or in regular instalments. You can choose how your family will receive this sum assured, according to their needs. Since a Family Term Life Insurance policy offers affordable premium rates, you will be able to get a higher value sum assured for your family.
Contingency plan
Family Term Life Insurance policies cover you if you can't work due to medical reasons. There are several riders to extend the terms of your policy's coverage, such as having to face a long-term illness or if you suddenly become permanently disabled. If you can no longer work, your policy can step in for your family.
Tax benefits
You can receive applicable tax benefits regarding payment of life insurance premiums. These benefits are as per Section 80C of the Income Tax Act and allow benefits up to one and a half lakh rupees per financial year as per the corresponding terms and conditions.
Peace of mind
Your family will feel your loss everyday, but taking finance matters off their mind will help remove one worry off their plate. Family Term Life Insurance policy will go a long way to keep your family safe and financially secure after you're gone.
Frequently Asked Questions
Here’s a list of common questions and answers related to Family Term Insurance.
Can we purchase Family Term Life Insurance for my family?
Yes, you can buy a Family Term Life Insurance policy to cover you and your family's financial needs as it offers pure life coverage (death benefit).
How can my family use the Family Term Life Insurance policy?
Your Family Term Life Insurance offers a sum assured to your family in case of your death during the policy term. Your family can use the payout to pay for needs such as education fees, to cover expenses, pay for your burial and last rites, among other payments.
How much should my Family Term Life Insurance policy's sum assured be?
Your family's financial requirements and standard of living along with debts such as loans will determine how much your policy’s sum assured should be.
Disclaimer: The content on this page is generic and shared only for informational and explanatory purposes. It is based on industry experience and several secondary sources on the internet, and is subject to changes.
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