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How to Choose Life Insurance Policy as per salary

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How to Choose Life Insurance Policy as per salary
April 09, 2019

Choosing a life insurance policy is one of the critical components of a successful financial portfolio and is a very much needed step that can define the future financial coverage for you and your loved ones. A traditional life insurance policy provides a person with the required financial coverage by entitling the person's nominee(s) to receive the main plan benefits in the event of the person's demise during the plan term. Moreover, in case the person survives the plan term, there are maturity-benefits to which the person is entitled. Therefore, a life insurance policy offers due coverage benefits to the policy holder by ensuring that there are complete financial reserves in place for the needs and requirements of the policyholder's family, even in her/his absence.

Before choosing a life insurance policy, there are a number of parameters that must be duly considered. One of the most important among these parameters is the payable premium which depends on your monthly salary. There are insurance providers who give the option of a one-time lump-sum payment to the policy holders. In such policies, the policy holder can pay the payable premium amount in a single go, without having to shell out money on a regular frequency. However, such types of policies are ideal for people having irregular income. For a salaried individual, the option of regular premium payment is seemingly more suitable as it fits the budgetary requirements and other financial obligations that the person may have. An insurance policy must not be counted as a liability as the premiums that you pay towards it add on to create a sufficient corpus by the time of actual requirement. This not only ensures that there are sufficient funds in place by the time of plan maturity but also guarantees that futuristic protection for your loved ones is sustained.

The monthly salary that you earn is the cyclic income that provides complete sustenance to you and your family. If you have dependent spouse or other family members, then there is an added responsibility and therefore, any financial decision taken by you must be taken after due thought. The contribution that you will make towards the insurance plan is one such decision. Ideally, the surplus amount that you are left with after meeting your monthly expenses and after contributing to the savings fund that you have is enough to be invested towards the insurance cover. However, this depends on the amount that you can set aside for premiums on a monthly or a regular periodic basis. Life insurance plans come with various additional riders as well and if you avail of these riders, the overall cost of the plan increases significantly. Therefore, you must choose the additional riders carefully and as per your actual requirement.

HDFC Life offers various term insurance plans that are meant for your overall financial protection and the coverage of your loved ones. For details, click on HDFC Life Term Insurance Plan

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Francis Rodrigues Francis Rodrigues

Francis Rodrigues has a decade long experience in the insurance sector, and as SVP, E-Commerce and Digital Marketing, HDFC Life, manages the online sales channel, as well as digital and performance marketing. He has had hands-on experience in setting up sales channels and functional teams from scratch over a career spanning 2 decades.

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Vishal Subharwal Vishal Subharwal

Vishal Subharwal heads the Strategy, Marketing, E-Commerce, Digital Business & Sustainability initiatives at HDFC Life. He is responsible for crafting and ensuring successful implementation of the overall organisation strategy.

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