Diwali is just around the corner. It is a tradition to give and receive gifts among close family and friends during Diwali. There is a deep significance in this ritual of exchanging gifts, which is believed to be a gesture of showing gratitude and love to the people close to us.
People buy and exchange numerous gifts during Diwali in varying price ranges. However, if you are considering a meaningful and unique gift idea for your loved ones, a gift of life insurance is the best option.
Looking at the unpredictable nature of life, protecting your near and dear ones with the gift of insurance seems the most significant one this Diwali. Let’s understand it in detail.
Why Life Insurance?
The significance of a life insurance policy is known to all. Life insurance is a plan that provides a fixed amount of money to the family of the insured if the individual passes away during the tenure of the plan. By gifting a life insurance plan to your loved ones, you can nominate them to avail of the sum insured offered under the plan and secure their future.
Practical Benefits of Gifting Life Insurance
There are several practical benefits of gifting life insurance policies to your loved ones during the festive season. Apart from the financial security these plans provide, another significant and appealing aspect of acquiring a life insurance plan is your peace of mind.
Here are some reasons to consider life insurance as a gift this Diwali:
1. Financial security:
A life insurance plan secures the future of your loved ones in your absence. If you are the sole breadwinner of your family, it is extremely crucial to ensure the safety of the family with a term/life insurance plan
2. Protection against unforeseen:
We can’t predict the unforeseen events of the future. Hence, a cover in the form of life insurance is vital for your mental peace and to safeguard against various unpredictability of life
3. Tax benefits:
Tax benefit under section 80C is another aspect that appeals to people obtaining life insurance policies for gifting purposes
4. Investment potential:
Life insurance policies also have good investment potential, and they can serve as the best long-term life insurance instrument. Together with protection, these policies support wealth creation
Customizing the Gift
If you are planning to buy life insurance as a Diwali gift to secure your family, many flexible plans allow customization as per the needs of your family.
Here are some options that you can consider while planning a life insurance gift for your family:
1. Term insurance:
A term life insurance policy is a gift that will protect the lives of your loved ones with financial security during your absence. This is a pure-term insurance policy that offers death benefits to the nominee in the event of the death of the insured. The plan offers a high sum assured and is available at a low premium price.
2. Whole life insurance
A whole life insurance plan is a life insurance that covers the insured for the duration of their entire life. All you need is to keep paying the premium on time to avail of the whole-life benefits.
3. Endowment policies
An endowment policy is a life insurance plan providing life cover to the insured. This plan supports the policyholder to accumulate wealth. This is a guaranteed return policy where the insured can avail return that is fixed at the time of purchasing the policy.
ULIP or Unit Linked Insurance Plan is a multi-faceted life insurance product. These are insurance cum investment plans that provide options like stocks, bonds, or mutual funds, where the insured can invest their money.
5. Money-Back Policy
Under money-back plans, the policyholder receives a part of the sum assured at frequent intervals. Hence, the insured may not get the lump sum amount at maturity. This is like an endowment policy with liquidity benefits.
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Choose the Right Policy to Make it the Gift of Responsibility and Care
Gifting life insurance reflects a sense of responsibility and care for the beneficiary’s future. However, it is crucial to choose the right plan that can present maximum benefit and cover the maximum needs of the recipient.
Before buying a plan, consider questions like:
- What are the benefits offered under the plan?
- Will it cover the expenses of your family in your absence?
- Will the sum assured/return be enough for the higher education of your child?
- Will it cover to pay the debts/loans you have incurred in your lifetime?
Buy a policy that answers all your relevant queries to safeguard your family while you are gone.
Encouraging a Shift in Gift-Giving Tradition
Diwali is a time to cherish with family. It is a time when you feel a sense of gratitude for everything you have. Exchanging gifts is a significant part of Diwali festivities. However, it is time to encourage a shift in Diwali’s gift-giving tradition. Rather than gifting materialistic and traditional things to your loved ones, let’s inspire people to give more meaningful and long-lasting gifts. It will make a huge difference in the perception of your loved ones and make them more responsible.
However, the idea of gifting insurance is not limited to Diwali. People can think of occasions beyond Diwali. Occasions such as birthdays, anniversaries, and other festivals can be an option to cherish the idea of gifting insurance and investment plans to your dear ones to make their lives secure and safe.
Overcoming Common Misconceptions
Several common misconceptions related to life insurance often hold policy seekers back from investing in life insurance plans. Some of the popular beliefs are:
Myth 1 – Life insurance policies are beyond one’s affordability
Myth 2 – Young people do not require life insurance protection
Myth 3 – The life insurance policy offered as part of my job is enough
Myth 4 – I am not eligible for life insurance
All these and more are just myths that are popular in India. However, contrary to popular belief, life insurance policies are affordable and easily accessible in India. We have already highlighted some of the plans above in the post.
Popular Life Insurance Companies India, 2023
As discussed, having a paradigm change in gift-giving options and making life insurance a popular gift idea for your dear ones is a significant gesture. It will brighten the lives of your family with a sense of security. This Diwali, let’s make the change by giving a thoughtful and meaningful gift option for their loved ones.