Do you want to purchase a term insurance plan but wish you could pay off the entire premium in a single set? Well, single-premium term insurance is just what you need in this case. It is a form of term insurance plan that allows you to pay off your entire premium in a single sitting. So, unlike standard term insurance, where you need to pay the premiums either monthly or on a yearly basis, a single premium term plan lets you pay off at once.
This is a very convenient way of opting for a cover amount without the hassle of regular premium payments. Although hefty, paying off this sum at once renders you with peace of mind too. If you are also looking to purchase this plan, here’s what you should know. Learn below as you scroll through.
For Those Who Don’t Already Know What A Term Plan Is…
Before you hop on to Single Premium Term Insurance, it is important to know about term plans if you don’t already know. Basically, term insurance is one of the oldest and purest forms of life insurance that provides life cover. This is done after paying a regular premium which is done on a monthly or yearly basis.
The idea of receiving a life cover is to protect the policyholder’s family financially when the policyholder is no more due to an untimely demise. This means that the family does not have to compromise on their financial interests when the policyholder (the sole breadwinner in the family) passes away. They can continue to receive financial help through the life cover, which will be accessible to them after the policyholder’s death.
In simple terms, a term insurance plan is an agreement between the policyholder and the policy provider. Since this plan is very simple and easy to understand, most individuals opt for a term plan first. Single-premium term insurance plans fall under this category.
Single Premium Term Insurance Plan Explained!
Kunal is a freelance photographer who received a substantial sum from his client. This sum was large enough to invest in a mindful term insurance plan. Since Kunal had long been waiting for this opportunity, he decided to make an investment. But the thought of paying regular premiums made him step back.
The next day, his friend Simran told him about the Single premium term insurance plan. That is when Kunal realized that he no longer had to dread paying regular premiums for his term insurance plan. With the Single Premium term plan, he was at liberty to pay off the whole sum at once and enjoy the cover under the term plan peacefully. Kunal did exactly that!
What Are The Perks Of Single Premium Term Insurance?
1. Purchase And Forget
Unlike a standard term insurance plan, where you have to be worried about paying regular premiums time and again, a single premium term plan is exceptional. Here, you can purchase the whole plan by paying the entire premium at once. This is done at the time of purchasing the plan itself. So, this plan gives you the liberty to buy the policy and forget about it. You no longer have to be worried every month or on a yearly basis when you have to make payments.
2. Stress-free Life
The liberty to pay the entire premium at once renders you great peace of mind. With this, you can live a stress-free life without any worries about paying premiums again. Once you pay off your premiums, you will know all your dues are clear, you have the cover to provide financial protection to your family, and all is well.
3. Tax Benefits
Another great reason to opt for this plan is its range of tax benefits. The premium paid is eligible for a deduction under the 80C Section. This is only possible up to Rs. 1.5 lakhs. The death benefit is also tax exempted. But this is possible under Section 10 (10D).
Single-premium term insurance can be a wise option for those who do not mind paying off the premiums at once. If you think you can do it too, switch to a single premium term insurance today.