What Are the Benefits of Term Insurance If You Have Debt? | | PayBima

Benefits of Term Insurance If You Have Debt

Buying new cars and houses or going on exotic vacations is a new habit for many of us these days. It is the foundation of a good, happy life; however, without sufficient funds, it may be difficult to meet all these demands. This is where credit comes to the rescue.

A loan is the best way to enjoy all the good and the good and fulfill the wishes of your family members. However, every loan comes with responsibility. If you are employed and earn a good income, you can easily pay off the loan and continue to live comfortably without stretching your finances.

But have you ever thought about what your family would do if you died suddenly? How can they pay you back if you don’t have a loan? This is why you need a backup to ensure that all your Equated Monthly Installments (EMIs) can be paid on time and that your family does not face financial hardship after you.

A long term insurance that is the best way in this matter. The benefits of term insurance are many. Let’s take a look at some of them briefly here:

  • They provide financial protection to your family at a minimal cost, in case of any emergency. For example, by paying only Rs. 12000 annual premium, you can be eligible for a maximum cover of Rs. 1 million. Of course, premiums are calculated based on the age and lifestyle of the owner. You can compare the premiums of different plans and choose the best one by using the insurance calculator.
  • They provide complete security by taking care of all your EMIs and other financial needs in case of sudden loss. When you buy a term plan, you will be given several options when it comes to receiving the sum assured (death benefit) from the insurer. You are free to choose lump sums (one time) or monthly payments. Note that if you choose the one-time payment option, the beneficiary will receive the entire amount at once and the plan will be canceled later.

Benefits of Term Insurance If You Have Debt

However, if you choose the regular payment option, the beneficiary will receive payments for several years. This can be a great way to change your family and can help them pay off their mortgages, car loans, or personal loans.

Benefits of Term Insurance Plan for Home Loan

Every person dreams of buying his own house. To fulfill this dream, several people take home loans. Since you have to pay the EMIs on time, you should protect your home loan with a long term insurance policy. If you have taken out a large loan, it is better to choose a beneficiary payment method.

Additionally, you should choose critical illness cover as your backup plan. If you are diagnosed with a serious illness such as heart disease or cancer, you may be entitled to a large sum of money from the insurance, up to Rs. 20-30 lakh.

BBenefits of Term Insurance Policy for Personal Loan

Personal loans are small amounts borrowed to meet personal goals/needs. So you can choose payment options depending on the loan amount and term.

Again, you can take critical illness cover if you are unable to work due to any medical condition. Be aware that you have to pay higher interest rates on your loans so always choose a backup plan to avoid high interest rates. You can choose to opt for a cover of Rs 20-30 lakh for critical illness.

How Term Life Insurance Can Help With Student Loans

Student loans are usually less expensive than home loans. This means that you can choose monthly payment options so that your family members can repay the EMIs.

Importance of Term Plan and Car/Bicycle Loan

Again, your loan amount can be smaller when buying a bike so you can opt for regular installments to pay the EMIs. To pay off your car loans, you can go for a consolidation and regular payment option. In this case, you can receive 30-35% of the guaranteed amount as the total amount from the insurance.

Also Read: Is Term Insurance With Low Payment Option – A Detailed Guide

How Term Life Insurance Benefits Married Women’s Property Laws

If you are a married woman, you can buy term life insurance under the MWP Act. Today many insurance companies offer the advantage of buying term insurance online. Therefore, you can buy a term plan from the insurance website. The main purpose of the MWP law is to protect women’s property from family, debts and even husbands. According to the law, the beneficiaries and trustees will receive the money from the insurance company.

Importance of Term Insurance Regarding Mortgage Insurance Plan

This is also known as a home loan protection scheme which reimburses the loss due to non-payment of EMIs (in case of unexpected death of the borrower). Some insurance policies may cover riders such as accidental death, disability, chronic illness, and loss of employment under the policy. While most plans offer a single premium plan, some offer fixed and low premiums.

If you think about “term life insurance benefits”, especially if you have debt, then the above should help you decide. Be aware that it may be difficult for your family to pay all the bills and pay off the debt in your absence. So, opt for term insurance to ensure financial security for your family.

Did you find this post informative? Browse PayBima Blogs read interesting articles about Health Insurance, Car Insurance, Bike Insurance, Term Life Insurance and Investment part. You can visit PayBima Buying Insurance Online.

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