A term insurance plan is a type of whole life insurance policy. As per the plan, if the life insured dies during the term, the beneficiary would get the amount assured at the time of policy purchase. The whole life insurance cover is provided against a fixed amount of premium paid for a specified term of the year.
But how would you know whether you should purchase this term insurance plan? Is it beneficial for you? Who should buy this insurance plan, and when is the right time to purchase one? The answer to all your questions is given in this article!
Why should I buy term life insurance?
Term insurance policies offer financial security to the family of the insured and help in coping with future needs of the family of the insured, like their children’s higher education or marriage, etc.
Amongst all the life insurance policies, the term plan with return of premium such as iSelect Star Term Plan and POS- Easy Bima Plan, gives you the maximum benefit in return for the minimum amount of premium charges. There are various reasons to buy a term plan with a return of premium. Some of the reasons are listed below:
1. The dependency of your family
The money from the term life insurance can be put to use to meet the monthly expenses of your family and dependants, with you not being around. To add to it, some major expenses like the higher education of your child and their marriage can also be taken care of by this whole life insurance plan.
2. Protection of your assets
You can take loans for assets such as houses or cars with the help of a term insurance plan. But with you not being around, there is a chance that your family will be burdened by the loan amount. Under such circumstances, the term insurance plans provide the payout benefit, which can be utilised by your family to pay off the loan amount.
3. Risks related to lifestyle
Various ailments and diseases are quite common with the present-day lifestyle. Now, some of the term life insurance plans would not only safeguard the dependents after the demise of the policyholder but will also provide critical health benefits for a lifetime. The whole life insurance policy tends to pay in case the beneficiary is diagnosed with some critical illness like cancer or heart attack.
What is the right time to buy a term life insurance policy?
The sooner you get the term life insurance plans, the better it would be for you and your family and dependents. It is advised that the ideal time to purchase whole life insurance plans is as early as is practically possible. Purchasing the term life insurance policy, which is suitable for you, and purchasing it as early as you can help you get the coverage as per your desires.
If you purchase these insurance policies at an early stage of life, it will help you get a lower rate of premium that would be required to be paid by you. As soon as you realise that there are people who are dependent on you, you shall immediately apply for a term life insurance policy without making any further delay.
If, due to some reason, you have failed to purchase a term life insurance plan at an early stage of your life, go ahead and make amends by immediately purchasing one such policy, as per your requirements.
Who should buy a term insurance policy?
If by any chance, you are an individual who is having a family or any person who is depending on you financially, it is high time you considered purchasing a term plan with return of premium. This means that any professional, married couple, a person with a family depending on them, parent, etc., shall look forward to buying a term insurance policy as soon as possible.
The added benefit is that you would be exempted from tax as per section 80 (C) of the Income Tax Act, 1961. So for any person who wishes to provide life protection to their family or dependents at a low rate of premium, along with tax exemption, this whole life insurance policy is just perfect. Given below are some other benefits:
Parents, especially single parents , are generally the sole source of income of the family. There is a high chance that your child or children are not big enough to financially support themselves and are totally dependent on you.
So, the best way in which you can secure the future of your children is by purchasing a term life insurance policy as soon as you can. This way, in case of your demise, your children will at least be financially secured.
2. Individuals with family
If you have a family that is dependent on you, and you happen to be the sole earning person in the family, you better opt for a suitable term life insurance policy. Therefore, you keep the family financially secure, and you don’t have to worry about their future in case of your sudden demise.
3. Newly-married couples
The term insurance policy will provide a safety net of financial security to your spouse in your absence. To add to the provision of financial security, the whole life insurance plan will also take care of the liabilities.
4. Young professionals
It is advisable to purchase the term insurance plan at an early age rather than opting for them at a later stage of your life. This will ensure that the premium that you will have to pay for the policy would be quite less as compared to the premium of the plan purchased at an older age. Moreover, by purchasing the term insurance policy at an early stage of your life, you will be securing the financial future in the long term.
Thus, it is now crystal clear that it is always best to purchase the term insurance plan at the earliest stage of your life, without making any delay if you have any person who is dependent on you in any way financially. The right time is now! Make no more delay and get the term plan benefit which is suitable for you.