Life and its circumstances are fragile. Therefore the need for some kind of financial protection for the future becomes mandatory. Various options are available for consideration as investment avenues. Let's take a closer look at Life Insurance and it's many advantages.

The most commonly expressed needs/desires of people are :

• The need to save for future family expenses and old age
• A house to call their own
• Financial assistance in the event of contingencies like accidents, etc.,
• And of course a certain degree of tax relief

Saving for the future

Loan

Income tax rebate

The periodical payments of premium become a habit. Unlike other savings plans where only the accumulated savings is payable on maturity, the entire sum assured is payable in a Life Insurance plan. Plus there are the bonus and loyalty additions that many Life Insurance plans boast of. In the case of endowment policies, benefits can be received at the time of anticipated expenditure like education or marriage. Pension plans provide a steady monthly income after the productive years. Life insurance additionally provides financial protection against the risk of unforeseen death.

Housing loans are granted by the Life Insurance Corporation against all plans that cover risk. In addition several Life plans have been especially introduced for housing loan purposes. General loans are also available on Life plans that have surrender value. These loans are ideal to meet unforeseen expenses. Since LIC's interest rates are much lower than that of other financial institutions, the burden of paying interest is not acutely felt. Further, a life Insurance Policy document is acceptable surety for a commercial loan. The policy itself can be surrendered for a cash sum to help tide over any financial difficulties.

Permanent disability benefit is given in the case of disability due to accident.

The premium paid on Life plans and specified investments like PF, NSC, etc., are eligible for income tax rebate, subject to a collective ceiling of Rs.60,000 p/a. Maturity benefits, bonus, etc., received under a Life Plan are fully exempt from tax, with the exception of Key-man Insurance, and annuity schemes like Jeevan Adhar, Jeevan Akshay, Jeevan Dhara and Dhanaraksha Mutual Fund.