A sudden loss of a loved one who is also the sole earner in the family is a trauma for the dependents. Worries of day-to-day basic household requirements, education for children, medical aids for aging parents etc keep building up. In unfortunate circumstance like such, a Family Income Benefit Insurance plays a vital role in taking care of the basic expenses of the family. This is indeed ideal for young couples since they have the age benefit to plan for this policy.

Family Income Benefit Insurance pays certain amount, on a monthly basis to the dependents of a policy holder who passes away while the policy is on. The amount depends upon the premium that the policy holder was paying. The premiums depend upon factors like; the sum to be insured, the period, age of the applicant, sex of the applicant, and also the medical condition of the applicant. The basic motive of the policy is to maintain the minimum required income of a family (dependent parents, ex-matrimonial partner, and children) who might unfortunately lose the income earners. The payments also can be of two types as per the scheme applied for: it may rise in accordance to the inflation or may pay the dependents a fixed amount. This may also be a kind of pure insurance in which if the policy holder survives till the policy ends; he receives no payments of any form.

Family Income Benefit Insurance can be held by a single person or it can be a joint policy between two persons. In the first case of single holder, the survivors or a specific nominee avails the policy benefits. In case of a joint policy if either of the policy holders passes away then the survivor joint holder avails the policy benefits. If both policy holders pass away, then the person nominated will avail the policy benefits.

A combination policy of Family Income Benefit Insurance along with a Life Insurance or Critical Illness Insurance policy can be opted for. As an individual policy the Family Income Insurance sometimes becomes expensive in terms of premium to be paid. The entire design of the policy is different from other insurances because here there is no lump sum amount paid but a monthly income that suffices the minimum requirements of the dependents of the policy holder. The dependents have a choice of selecting the payment modes, that is, monthly, quarterly or yearly.

There are more benefits in combining Family Income Benefit Insurance along with Critical Illness Insurance policy. For example if the policy holder is diagnosed with a critical illness, then the family receives a pre decided amount as a monthly income. The policy design of this combination varies in terms and conditions but in most cases the policy includes critical illnesses like Heart attacks, Cancer etc. The rules and regulations may be different for persons who has a pre existing disease of any kind and had been diagnosed for the same before enrolling for the policy.

Family Income Benefit Insurance is advantageous than a Pure Term Life Insurance policy because of the monthly income facility. The lump sum amount availed from a Pure Term Life Insurance policy is saved as a fixed deposit in the bank by most people but again the interest received on the fixed deposit is taxable. So when one thinks about family protection, Family Income Benefit Insurance sounds to be a preferable option.