Why choose Life Insurance that also provides Regular Income? Best time to buy is before 31 March 2023!
In today's fast-paced world, life insurance is more important than ever before. We face different challenges and stress is a common factor. Our hectic lifestyle has made lifestyle diseases very common while the life expectancy in India has seen an improvement over the decades now. So more often than not, there might be a situation of a long retirement with rising medical costs, lifestyle expenses, etc.
Thus an adequate Life Cover along with regular income is required at all times. A life insurance policy is essential and usually provides protection against:
- Protection Against Uncertainties: Life is unpredictable, and there are various risks and uncertainties that can pose a threat to an individual's financial security. Life insurance provides a safety net for individuals and their families in the event of an untimely death or disability, ensuring that their financial needs are met.
- Rising Healthcare Costs: Healthcare costs are on the rise, and even a minor illness or injury can result in significant expenses. Life insurance policies with critical illness riders can provide financial assistance for medical expenses, ensuring that individuals can receive the best possible medical care without worrying about the costs.
- Lifestyle-related Risks: Modern lifestyle habits, such as sedentary lifestyles, unhealthy eating habits, and stress, can increase the risk of health problems like diabetes, heart disease, and stroke. Life insurance can provide protection against such lifestyle-related risks.
- Protection Against Loans and Debts: In today's world, individuals often take on loans and debts for various purposes like education, home, or car loans. Life insurance policies can protect against such liabilities and ensure that the family members are not burdened with the debts in case of the untimely death of the borrower.
- Future Planning: Life insurance can serve as a tool for future planning, such as saving for retirement or ensuring that the children's education needs are met. It can also provide a source of regular income for the family in case of the primary breadwinner's death.
Guaranteed Income Plans one such product that provide life cover as well as regular income.
Guaranteed Income Plans are actually a type of life insurance policies that provides regular income to the policyholder. However, not all Guaranteed Income Plans come with a life cover. Some Guaranteed Income Plans may offer life cover as an additional benefit, but the primary purpose of these plans is to provide a guaranteed income to the policyholder.
Guaranteed Income Plans have many benefits
Guaranteed Income Plans are multi-beneficial products because they offer a range of features that cater to the different needs of investors. Here are some of the facets that make Guaranteed Income Plans a versatile investment option:
- Guaranteed Returns: Guaranteed Income Plans provide a fixed rate of return on your investment, which means you can calculate your earnings beforehand. This makes it an ideal option for risk-averse investors who want a stable income.
- Regular Income: Guaranteed Income Plans offer regular payouts, which can be monthly, quarterly, or yearly. This feature makes them a popular choice for retirees and those who need a steady income stream.
- Tax Benefits: Guaranteed Income Plans also give tax benefits u/s 80C of the Income Tax Act,1961. Investors can claim a tax benefit on the premiums paid towards these plans, up to a maximum limit of Rs. 1.5 lakhs.
- Life Cover: Some Guaranteed Income Plans also come with a life cover, which means in case of the policyholder's demise, the nominee will receive a lump sum amount in addition to the regular payouts.
- Flexibility: Guaranteed Income Plans offer flexibility in terms of the premium payment frequency, payout frequency, and the duration of the policy.
- Liquidity: Some Guaranteed Income Plans also offer a loan facility, which means you can take a loan against your policy if you need funds urgently.
Budget 2023 and the ruling on Life Insurance policies
As declared in Budget 2023 by the Finance minister, Nirmala Sitharaman, the Returns from traditional plans issued on or after 1-04-23 will be taxable if the premium from one or more policies is in excess of Rs. 5 Lacs. If one is looking to buy an investment that can provide regular income as well as a life cover, then one can buy guaranteed income plans and the best time to buy these plans is on or before 31 March 2023.
