Pure Term Life Insurance

Pure term life insurance is the BEST insurance product available in India as it covers your life at very cheap cost. Ideally one need life cover of 10 times of their annual salary which only term insurance can provide you. One should divide their life cover in more than one term insurance plans. Say if your insurance need is Rs.50 lakhs than buy 2 term insurance plans of 25-25 lakh each.

This has two advantages.

• You will diversify the risk of rejection by dividing your life cover in 2 term insurance plans.
• During your retirement/old age when your dependents become financially free and you become liability free, you can discontinue 1 term insurance plans and reduce your life cover and premiums also. If you have invested in just 1 term insurance plans than this won't be possible.

Also please note that insurance is not about money, so never think of returns from insurance and avoid investment in any insurance cum investment product.

Buy term and invest the difference

Remember Insurance and investment are two different things. Term insurance is available at very lower premiums which will provide you high life cover and the difference of premium you can invest in mutual fund. Insurance cum investment products will give you just 5 to 10 times life cover than the annual premium which is very small in comparison to term insurance plans.

All the insurance cum investment financial products in India are very costly and should be avoided. Remember that, you need a pure term life insurance policy to cover your life, mutual funds to build a wealth and PPF to save lots of tax under section 80c.