Life insurance is a financial product designed to provide monetary protection to an individual’s family or dependents in the event of the policyholder’s untimely death. It acts as a safety net, ensuring that loved ones are financially secure and able to maintain their standard of living even after the loss of the primary breadwinner.
There are several types of life insurance plans available in India, each catering to different financial needs. The most common is term life insurance, which offers high coverage at affordable premiums for a specified period. If the policyholder passes away during this term, the nominee receives the sum assured. There are also endowment plans, unit-linked insurance plans (ULIPs), and whole life policies, which combine insurance coverage with savings or investment components.
Eligibility for life insurance typically starts at 18 years and can go up to 65 years, with policy terms ranging from 5 to 40 years. The sum assured, or the amount paid out on death, can start from as low as ₹25–30 lakhs and go up to several crores, depending on the insurer and the policy chosen. Premiums can be paid yearly, half-yearly, quarterly, or monthly, offering flexibility to policyholders.
Many policies also offer riders, such as accidental death or critical illness benefits, for enhanced protection. In recent years, the Indian life insurance sector has seen increased customization, lower premiums, and higher benefits, making it more accessible and attractive to a broader population.
Life insurance not only provides peace of mind and financial security but also offers tax benefits under Section 80C of the Income Tax Act. Choosing the right life insurance plan depends on individual needs, financial goals, and family responsibilities, making it an essential component of sound financial planning.