Benefits of Insurance

There are a lot of benefits of buying insurance and listed below are some of them:

Financial Safety for Family:
They provide cover against life's uncertainties and protect you against losses arising from different unexpected events in life.
Safety of Financial Status:
Certain events like medical emergencies can have a significant impact on your cash flow management. Insurance ensures you don't have to pay out of pocket for such situations.
Wealth Creation Goals:
Insurance policies like ULIPs give you investment opportunities and help you fulfil your essential financial goals.
Wealth Preservation:
Life insurance policies like endowment and moneyback plans are some of the safest long-term investments possible. These plans help you preserve your wealth from inflation and taxes for long periods.
Wealth Distribution:
Few investment plans offer the kind of safety offered by life insurance pension plans. After retiring at the age of 60, you can live up to 100. Only life insurance pension plans can guarantee a regular income for that period.

Must-Have Life Insurance Policies

Insurance plays an important role in our lives. Be it a life insurance policy, or a motor insurance, having insurance coverage helps us financially in different stage of our lives.

Listed below are different types of insurance coverage that one should have:

Term Insurance Plan:
This is the purest form of life insurance wherein you pay a premium towards the policy, and in case of your death during the policy tenure, the nominee receives the sum assured. With term insurance, you can receive high coverage against a lower premium. iSelect Smart360 Term Plan by Canara HSBC Bank of Commerce Life Insurance offers critical illness cover against 40 listed illnesses.
Health Insurance Plan:
Knowing the rising cost of healthcare and the number of diseases you can have, it is wise to have a financial cushion against health contingencies.

A health insurance plan will cover the expenses of your healthcare expenses as per the health policy that you have.
Motor Insurance:
A motor insurance is mandatory for those who own a vehicle in India. It is compulsory to avail of a third-party liability motor insurance. However, you can have a comprehensive package – personal accident cover that offers coverage against the risks of damage.
Home Insurance:
Your home is exposed to various kinds of risk like theft, damage due to natural calamity, etc. Hence to protect your home against such damages, you must avail of home insurance.

Such insurance plans will help you stay afloat even after a costly mishap or calamity.

Tax Benefits of Insurance

Along with providing financial security, insurance also offers tax benefits. Here are some of the tax benefits offered by insurance:

You can claim a life insurance premium of up to Rs 1.5 lakh under Section 80C.
Under Section 80D, you can claim a medical insurance premium of up to Rs 25,000 for self and family and additional Rs 25,000 for parents. The deduction limit rises to Rs 50,000 if the insured are senior citizens.
Under Section 10(10D), the life insurance benefits you or the nominee receives from the insurance company are tax-exempted. This means both maturity value and death benefit received from a life insurance policy will be tax-free.

However, the maturity benefit is tax-free only if your annual premium for the policy does not exceed 10% of the base life cover in the policy.