Imagine standing on a boat in the middle of the ocean. One moment, the waters are calm, the sun shining bright. The next, dark clouds gather, and turbulent waves threaten your balance. This is exactly how market volatility feels—unpredictable, nerve-wracking, and often beyond our control.
In such uncertain financial times, securing your future and protecting your loved ones is more important than ever. While market fluctuations can impact investments, Life Insurance ensures that your family’s financial well-being remains intact, regardless of economic downturns.
Understanding Market Volatility and Its Impact on Your Finances
Market volatility refers to the unpredictable ups and downs of the financial markets, often influenced by economic conditions, geopolitical tensions, inflation rates, and investor sentiment. While some fluctuations are normal, extreme market swings can erode savings, reduce investment returns, and create financial uncertainty.
For individuals relying on investments for long-term financial security, these fluctuations pose a significant challenge. It’s hard to imagine investing in your child’s education or retirement only to see your savings shrink due to an unforeseen market crash. That’s a risk no one wants to take.
This is where Life Insurance plays a crucial role. A well-structured life insurance plan ensures that your loved ones are protected, even when market conditions are unfavourable.
Why Life Insurance is Essential in Volatile Times?
During uncertain times, investors tend to look for stability. While traditional investments like stocks and mutual funds may offer high returns, they are also subject to market risks. On the other hand, Life Insurance provides guaranteed benefits, offering much-needed financial security.
Here’s why life insurance is a must-have during market volatility:
1. Financial Security for Your Loved Ones
The primary goal of Life Insurance is to provide financial protection to your family in case of an unfortunate event. Regardless of how markets perform, your policy ensures that your loved ones receive a lump sum payout, helping them maintain their lifestyle and meet future expenses.
2. A Shield Against Uncertainty
In an unpredictable market, having a stable financial instrument like Term Insurance is invaluable. Term insurance provides high coverage at affordable premiums, ensuring that your family is financially secure even if your investments face setbacks.
3. Long-Term Wealth Growth and Tax Benefits with ULIPs
If you’re looking for both protection and investment growth, Unit-Linked Insurance Plans (ULIPs) like the Aviva Signature Investment Plan – Platinum offer the perfect blend. These plans allow policyholders to invest in market-linked funds while ensuring that the sum assured remains protected.
Beyond investment growth, ULIPs also provide tax benefits, but the extent of savings depends on whether you opt for the old or new tax regime.
For example, Rahul, a 32-year-old professional earning Rs. 20 Lakh per annum, is evaluating ULIP investments under both tax regimes:
Old Tax Regime:
- Rahul’s approximate tax liability (before deductions): 3.12 Lakh
- He invests 2.5 Lakh in the Aviva Signature Investment Plan – Platinum, reducing his taxable income under Section 80C
- His new tax liability after deductions: 2.55 Lakh
- Total tax savings: 57,500
- Additionally, the maturity proceeds remain tax-free under Section 10(10D) if premium conditions are met
New Tax Regime:
- The new tax regime does not allow deductions under Section 80C, so Rahul’s taxable income remains Rs. 20 Lakh
- However, if his ULIP annual premium is below Rs. 2.5 Lakh, his maturity proceeds are still tax-free under Section 10(10D)
- This makes ULIPs a smart long-term tax-efficient investment even without immediate tax deductions
Thus, while the old tax regime offers immediate tax savings, the new tax regime still allows tax-free maturity benefits, making ULIPs a strategic wealth-building tool.
4. Liquidity to Meet Emergency Needs
Market downturns can lead to cash flow problems, making it difficult to manage sudden expenses. Policies with Partial Withdrawal Flexibility allow you to access funds when needed without liquidating long-term investments at a loss.
5. Tax Benefits for Smart Financial Planning
Life Insurance also offers attractive tax benefits under the Income Tax Act, 1961. By investing in insurance policies, you can optimise your tax savings while securing your financial future.
How Does Aviva Life Insurance Help You Manage Market Volatility?
Aviva Life Insurance understands the challenges of market fluctuations and offers comprehensive solutions to ensure financial stability. Here’s how Aviva’s plans stand out:
1. Aviva Signature Investment Plan – Platinum: Balancing Growth & Security
This ULIP-based plan provides both sum assured and fund value, ensuring that your family remains financially secure even in volatile times. Key benefits include:
- Flexibility to Manage Investments: Easily switch between funds at no extra cost.
- Systematic Partial Withdrawals: Provides liquidity for emergencies after five years.
- Retirement Protection: The RetireSafe feature reallocates funds to conservative options near maturity to reduce risk.
- Diverse Investment Options: Choose from eight funds based on your risk appetite.
2. Term Insurance: Affordable Protection for Maximum Security
For individuals seeking cost-effective financial protection, Term Insurance is the ideal choice. Aviva’s term insurance plans offer high coverage at affordable premiums, ensuring that your family is financially stable even in your absence. Benefits include:
- Fixed Premiums & Guaranteed Payouts: Unlike market-dependent investments, term insurance provides certainty.
- Customisable Cover Amount: Choose a sum assured based on your financial responsibilities.
- Additional Rider Benefits: Enhance coverage with accidental death or critical illness riders.
Secure Today, Confident Tomorrow
In a world where markets fluctuate unpredictably, financial security should never be left to chance. While investments are essential for wealth creation, they must be complemented with a solid Life Insurance plan to protect your family’s future.
With Aviva Life Insurance, you get the best of both worlds—market-linked returns and financial protection. Whether through Term Insurance for affordability or ULIP-based investment plans for balanced growth, Aviva ensures that you and your loved ones remain financially secure, no matter how turbulent the market gets.
Don’t let market volatility dictate your financial future. Take control today with Aviva and live life with confidence, knowing that your family’s future is protected.
*Standard T&C Apply
**Tax benefits are subject to change in prevalent tax laws.
***Disclaimer: The content on this page is generic and shared only for informational and explanatory purposes. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making any related decisions.
****Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms, and conditions, please read the sales brochure/policy wording carefully before concluding a sale.
(All articles published here are Syndicated/Partnered/Sponsored feed, Today News 24 Staff may not have modified or edited the content body. The views and facts appearing in the articles do not reflect the opinions of Today News 24, also Today News 24 does not assume any responsibility or liability for the same.)
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