Myth 2: Term Insurance Saves Tax Money

This is usually used as a selling practice by insurance associates. In all reality, tax-saving is one of several term insurance policy benefits.  The main benefit of a term insurance policy is to provide financial stability to the family in case of the policyholder's untimely death. Many tax-saving tools such as mutual funds, tax-saving shares, and government bonds, post-office savings schemes, and the Public Provident Fund (PPF) can be used to save taxes. Advice 2: It is imperative to pay the term insurance policy premium to meet the family's full financial needs in the event of the policyholder's death. The cover should be about 7-10 times the policyholder's annual income.