250 Words Life insurance is used to replace in whole or part

250 Words

Life insurance is used to replace in whole or part the economic value of human life for either family purposes or business purposes. In exchange for premium payments, the life insurance company agrees to pay a death benefit upon the death of the insured to the beneficiary named in the application for the policy. Life insurance policies may provide other uses and benefits as well. Do you feel that you need life insurance? Why or why not?

Solution

Yes I need life insurance.
Life insurance secures the financials of family in case of my death. A lump sum amount is received in case life insurance was taken as per the policy. Obviously death causes mental trauma but that trauma can be minimised for the family with insurance.

Premium for life insurance is tax deductible .Hence it provides a means to reduce taxes while acting as an investment in case of fatality. That particular amount is deducible form the gross income.

The life insurance is a safe and secure investment as compared to share market which has high risk and uncertainty. Hence once invested it gives returns at the expiry of the policy or in case of fatality. So assured returns is guaranteed.

It helps in achieving long term goals of achieving financial security. Even if the policy expires before death some policies provides fixed return along with tax benefits and returns on life insurance funds are non-taxable too. It is also acts a tool for savings.

Life insurance assures increase in value with no downturn risk It is as close as one can get to risk free return. Hence it ensures peace of mind as returns are not dependent on economy in most insurance policies.

There are many flexible options in life insurance like term insurance, life long insurance, indexed insurance, etc. There are a wide variety of options and based on requirement anybody can choose any type of option. Basically it gives options and based on amount of premium additional features or facilities are also provided

Best of Luck. God Bless