Due to the rapidly changing socio-economic factors and multiple initiatives by the government and the insurance sector, the common Indian has realised the need to purchase at least basic life insurance like a term plan. However, this realisation generally grips in later in our lives. Therefore, buying a term plan early in your life, for instance, in your mid-30s, is ideal for enjoying the complete benefits of term plans.
Moreover, these plans are no longer just basic plans; there are some term plans with a return of premium as well. In addition, online term plans ease the buying process, offer timely customer support, and provide hassle-free and quick claim settlement.
Why Buy Term Insurance at an Early Age?
Most insurance companies set a minimum and maximum age to buy a term plan. A typical term plan age limit is from 18 years to 65 years. However, the benefits of a term plan can be boosted if you buy it at an early age. Below are a few reasons that prove the importance of term insurance and that buying it early in life is more beneficial.
1. You are earning and have responsibilities.
In your mid-30s, you might find yourself settled in your job, settled personally, buying a house, or starting a family. This makes you more exposed to responsibilities. In case of an unfortunate event of death, you would want your family and your loved ones to stay financially secure. A term insurance plan can provide financial support to your family in your absence.
2. You get affordable premiums.
Buying an online term plan is a good option; buying it early in your life is even better! When you buy a term plan in your mid-30s, the premium you need to pay is low. On the contrary, the premium amount will be more if you buy the plan at a later stage in your life. Choosing the best term life insurance based on features, price and needs are always recommended.
3. You get a larger life cover.
The sooner you buy term insurance, the longer you get coverage. Additionally, the expected life cover in your 30s is considerably higher than for individuals in their 40s or 50s.
4. You have fewer chances of rejection.
When you are young, you are healthier. Your health is a major determinant of qualifying for term insurance. Individuals in their 40s, 50s, or more encounter ailments that can disqualify them from being adequately covered.
5. You can add riders.
Riders are additional benefits added to your term insurance which come at an extra cost. When you are in your 30s, you can opt for riders at a lower price.
6. You gain a source of income post-retirement.
Traditionally term insurance is a pure risk plan, and upon the survival of the policyholder till maturity, no death benefits are provided. However, there are variations in the basic term plans, like term plans with a return of premium.
Under this option, you can receive the paid premium on survival if the policy is not terminated. Similarly, some Tata AIA term insurance plans also allow you to get the return of premiums as income payouts and receive a regular monthly income.
7. You enjoy tax benefits.
Term plan tax benefits cannot be ignored. The premiums paid towards term insurance are tax-deductible under Section 80C under the Income Tax Act of 1961 up to a limit of ₹1.5 lakhs in a financial year. In addition, the death benefit is tax-free under Section 10(10D) of the Income Tax Act 1961. Thus, when you buy life insurance at a younger age, you enjoy tax benefits for a longer duration.
8. You are not solely dependent on employer-funded insurance.
Many employers do cover their employees under their group term insurance. But the coverage offered is generally insufficient. Your individual term plan can provide adequate coverage and make you less dependent on employer-provided term insurance.
The above reasons clearly state the benefits of a term plan, especially for younger individuals. So, if you’re still young, buy online term plans to protect your family’s future.