You always strive to offer the best for your loved ones. Thus, it would be best if you did not ignore the possibility of eventualities that can not only affect them emotionally but also cause a financial crisis. Being the principal wage earner brings enormous responsibilities and the uncomfortable thought that what if someday you are not there for them? What if any unforeseen accident takes away all your family has? Many such questions haunt you when it comes to the wellbeing of your family. The solution for these is to opt for a term insurance plan.
What is a term insurance plan?
Before making payments, it is necessary to understand what you will be getting with term life insurance. A term plan offers financial coverage for a specific period in exchange for a fixed premium. In an unfortunate incident leading to loss of life during the policy term, the appointed nominee receives the death benefits.
Usually, a renewable term plan allows you to revive your plan without any medical scrutiny when the previous policy ends. Some insurance providers offer convertible term plans that you can convert into an endowment policy. It provides payouts when the policy attains maturity. The term policies which are not convertible will not pay any maturity benefit if you survive the policy period. You should read all the terms and conditions carefully before making any payment to determine whether the product meets your needs.
What is the ideal age to buy a term insurance plan?
There is no wrong time to make the right decision in life. Especially when it comes to buying term life insurance, the right time is right now. It is advisable to invest in a term plan as soon as you start earning. Buying a term plan at a young age makes the investment less costly because the premium for term plans increases with age. The reason behind this is that with age, the chances of contracting complicated diseases increase and mortality rates go up. Thus, the insurer’s risk in providing the life cover rises, and the underwriting process assigns a higher premium to the aged applicant.
However, new-age term plans provide solutions to investors in every age bracket. You can buy term insurance as late as age 65 and acquire protection until an advanced age. This delayed age of entry is useful if you foresee loved ones depending on you financially until late in life. For example, your spouse might need funds for old age expenses. The proceeds from the term insurance can provide the money in your absence. If you are unsure about how much premium you have to pay, you can use an online term plan calculator. It will provide an estimate on the premium for your ideal life coverage.
What are the benefits of investing early in a term insurance plan?
- Younger the policyholder, lesser is the premium
- Enjoy high sum assured at lower premium costs
- Help your family in repaying outstanding loans and liabilities if they lose your income
- Avail deductions from taxable income under Section 80C of the Income Tax Act, 1961
- Get exemptions from medical checkups and tests
Life has a way of throwing curveballs your way, and the plans that life has in store for you may not always work in your favour. But the least you can do is to buy a term insurance plan and secure your family from the monetary hardships in the face of life’s uncertainties.