A life insurance policy is the greatest gift one can give themselves and their family. Whether you are starting out in your career, financially securing your life goals or preparing for retirement, life insurance remains among the most important financial decisions. Sabse Pehle Life Insurance should be the motto of every Indian.
However, despite its importance, India has one of the most under-insured populations in the world. Recently, Life Insurance Council conducted a survey across 40 cities with more than 12,000 people between the ages of 25-55 years to understand the Indian audience’s perception towards life insurance. Of the total respondents, 71% were secured owners of life insurance or were keen to buy one.
This survey is aligned with LIC’s new public awareness campaign “Sabse Pehle Life Insurance” which positions life insurance as a top priority for income earners in the family. This campaign represents the joint effort of 24 Indian life insurance companies working towards a common goal of improving life insurance awareness in the country.
In fact, the Covid-19 pandemic highlighted an increased adoption of life insurance among people. However, there is still scope for improvement – while 91% consider life insurance a necessity, only 70% are willing to invest in the same.
According to the report, some interesting trends that emerged include:
- Among all other financial instruments, Life Insurance has near universal awareness levels with around 96% as compared to mutual funds (63%) or equity shares (39%), says the survey.
- The importance of Life Insurance as a financial instrument largely remained the same across age groups and both males and females.
- More people above the age group of 36 years own life insurance than those younger than 36.
- Half of the respondents prefer buying Life Insurance from an Insurance Agent while three in 10 preferred purchasing it from banks.
- Approximately half (47%) of the total respondents claimed that they or someone in their family holds a Life Insurance plan and knows a lot about it, as per the survey.
The survey findings indicated high awareness, and that people of all age groups across India consider life insurance as an important financial instrument. As highlighted by the respondents, purchasing life insurance offers “protection in an unforeseen event, financial security for the future and achieving collective financial goals of the family”.
Here are some key reasons to invest in life insurance:
1. Securing your family’s future: No one knows what the future holds, but you can prepare for it and rest easy. Whether it’s your child’s education and providing your family financial security, life insurance provides assurance for your surviving dependents in the eventuality that you are not around.
2. Meet long-term goals: Life insurance policies offer diverse options for returns and allow you to achieve long-term goals such as buying property, resolving debt or building a retirement corpus. In certain cases, insurance companies allow the flexibility to change the amount of coverage, investment allocations, etc, depending on your needs.
3. Supplement your retirement fund: Life after retirement is a point of concern for most people, especially as life expectancy increases. With the right life insurance plan, you can ensure regular monthly income, through an annuity or pension plan.
4. Tax-saving benefits: You can enhance your income by cutting down on the tax you’re liable to pay by investing in an insurance policy. The premium you pay is eligible for a maximum tax benefit of Rs 1.5 lakh under Section 80C, as well as for tax-free proceeds on death/maturity under Section 10 (D) of the Income Tax Act, 1961.
5. Enabling savings: Life insurance offers tax benefits, which may prompt you to buy one initially. However, you will realise that it also functions as a savings tool. It is also possible to take a loan against the policy or you may be able to withdraw a partial amount during an emergency.
“Our aim is to ensure that every earning member of an Indian family makes life insurance a top priority, to secure a safe and healthy future for his or her family. We understand that care and responsibility go together, and we wish to safeguard this mindset and educate Indians so that we can offer the best life insurance solutions,” stated S N Bhattacharya, Secretary General, Life Insurance Council.
If you’re wondering how much life insurance you need, it depends on several factors such as the number of dependents, the lifestyle you want to provide, how much you need for your child’s education, as well as your investment capacity. You can take the help of an insurance agent or financial advisor to choose a suitable cover.
Ultimately, life insurance grants peace of mind, knowing that your family’s needs are well taken care of.
To know more about life insurance please visit sabsepehlelifeins.com