Why is Life Insurance Important?

Why Life Insurance ?

You may be earning well now, but unexpected emergencies may arise in the future. They may appear in the form of health emergencies or accidents. In this case, if you are the only one who supports the family financially, then it can become the worst phase for your loved-ones after your unexpected death.

Here are some specific reasons for buying a life insurance policy.

Dealing with Debt

Buying the right life insurance policy to help your family deal with debts like an auto loan, personal loan, education loan, home loan, or a loan on credit cards is very important so that in your absence or during difficult times your family does not have to deal with these liabilities.

Helps Achieve Long-Term Goals

Life insurance is the best policy for achieving long-term goals such as buying a home or a car, planning your retirement, or planning your child’s education and wedding.

Tax deductions

If you are young and employed or have a recurring source of income, such as a business, then life insurance is one of the ways to invest your money and even save tax. Under the current Income Tax laws and under section 80C you can save tax on upto 1.5 lakhs of your income by investing in Life Insurance policies. So Life Insurance offers the triple advantage of securing your family in your absence, providing growth to your investment and also saving taxes.

Critical Illness Cover

Some life insurance policies include a critical health insurance cover as well which can help you to financially fight against life threatening diseases like cancer, kidney failure etc.

If you have Extreme Hobbies

If you have extreme hobbies like scuba diving, rock climbing, bungee jumping or something equally thrilling, then you definitely need to buy life insurance. Usually insurance companies charge extra premium to cover these extreme activities.

Hence having life insurance is one of the most important things in one’s life. But most people are uninsured or under insured which means they don’t have adequate cover compared to their lifestyle and liabilities. If there is one important lesson that Covid-19 pandemic has taught us than it is the importance of having adequate life insurance.

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