Life Insurance for Family

What is the Role of Life Insurance for Family and the Best Life Insurance Providers?

Life insurance for family is a plan that allows your family to be protected in the event of a tragedy that befalls you. 

It can pay your family if you get very ill or if you pass on. 

This money can be used to buy the essentials such as food, a house, school fees for children, and other things.

Why Is Life Insurance Required By Families?

  • To make money if the person who is earning for the family becomes ill or dies.
  • To cover the costs of the child’s school and university education.
  • To finance the wedding of the child.
  • To cover the cost of medical bills if someone gets extremely ill
  • To cover the family’s loan or debt payments.

There are various types of life insurance schemes for families. Let’s learn about them.

Types of Life Insurance for Family

Term Insurance Plan

  • This is one of the most popular options that families tend to take.
  • You contribute a small sum of money (premium) to the insurance company periodically.
  • In case of your death during the plan period, the insurance company will pay your family a large sum (sum assured) of money.

For example, you spend $100 per month for the next 20 years. If you are dead within these 20 years, your family members will get $500,000.

Retirement / Pension Plan

  • This plan ensures that you have money when you are old and cannot work anymore.
  • You are supposed to pay the insurance premiums regularly to the insurance company.
  • When you are old (like 60 years), the insurance company will transfer the money to you in the form of income. Hence you can use this money when you stop working and getting a salary.

Child Insurance Plan

  • This plan will help you to create a fund for your child’s future needs.
  • Premiums are paid every month till the child reaches 18 years old.
  • The insurance company then pays out the entire amount after 18 years to your child.
  • Your child may have a chance to use this money for college, weddings, or any other big events.

Whole Life Insurance

  • This policy is a whole life insurance and will be valid until you pay the premiums.
  • Your contributions to the account continue to build up and earn interest.
  • Your family will access the death benefit in case of your death and you will get the amount that is in the account.

Child Life Insurance

  • Such a plan of saving will enable a child to have a bright future for college and marriage.
  • Parents or grandparents buy the insurance policy and pay the premiums until the child reaches the age of majority.
  • The child gets a lump sum of money, when they turn 18 or when they begin to receive regular payments.

Insuring your life is the best way to be sure that your loved ones will have a secure future even if something bad happens to you.

Read More- The Best Home Loan Insurance in India

Best Life Insurance Providers for Family

There are many insurance companies that have life insurance policies for the families. Some of the top life insurance providers in India include

  1. ICICI Prudential
  • High claim settlement ratio of 97.82%
  • Offers plans like iProtect Smart for families
  1. Max Life Insurance
  • Excellent 99.34% claim settlement ratio
  • Max Life Smart Secure Plus is a popular family plan
  1. Tata AIA Life
  • Claim settlement ratio of 98.53%
  • SRS Vitality Protect plan provides coverage for families
  1. Bajaj Allianz
  • 99.02% of claims are settled
  • eTouch plan designed for family protection
  1. HDFC Life
  • 98.66% of claims are paid
  • Click 2 Protect Super plan covers whole families

When choosing a life insurance for family, you should look at the claim settlement ratio to ensure their claims will likely be paid if needed. 

You should also compare premium costs, and policy benefits and read the terms carefully across different insurers before selecting a suitable family life insurance plan.

These companies have good claim settlement records, which means they pay the insurance money properly when needed.

Need of Life Insurance for Family

Life insurance secures a family’s financial future if the policyholder dies unexpectedly. The death benefit payout can:

  • Help the family maintain their lifestyle
  • Pay for housing costs like rent
  • Take care of child-related expenses and fees
  • Pay off remaining loans and debts

Life insurance also gives policyholders peace of mind. They know their loved ones will have financial stability if anything happens to them.

How Much Coverage?

The amount of life insurance for family coverage should align with a family’s financial needs. Experts recommend:

  • Calculate monthly expenses, income, loans, and liabilities
  • Choose a coverage amount 10-15 times your annual income when purchasing
  • Use an online calculator based on age and income to estimate needs

Getting sufficient coverage ensures a family receives enough funds to carry on financially if the policyholder passes away.

Buying Life Insurance for Family Online

Here are the steps to purchase life insurance for family online in India:

  • Visit the insurance company’s website life insurance page
  • Enter personal details like name, gender, birthdate and contact info
  • Provide financial details like income, job, status, and education level
  • Compare and select the best whole-family life insurance plan
  • Make the payment to finalize purchasing the policy

Choosing the Best Policy

When selecting the best life insurance for family, consider:

  • Your goals and reasons for getting life insurance coverage
  • Getting coverage equal to 10-15x your current annual income
  • Comparing premium rates, policy terms, and coverage amounts across insurers
  • Using an online calculator to estimate premiums for your desired coverage level
  • Picking an insurer with a consistently high claim settlement ratio
  • Reading all policy terms, conditions, and fine print carefully
  • Buying earlier in life when premiums are lower