PROTECTION: As your needs and goals change, there is a need for different kinds of life covers
Term insurance is a value-for-money insurance policy that helps you provide a safety net for your loved ones. With an adequately high sum assured for relatively low premiums, you can rest assured that your loved ones will live well and achieve their life goals, even if you're not there to provide for them. There are a plethora of term insurance plans to choose from, and it can sometimes make one wonder which is the perfect fit. With each milestone in your life, your needs and goals change, leading to the need for different covers at different life stages. Here's a handy guide to figuring out the right plan for each life stage.
First job
You have just graduated, you have no dependents and have limited liabilities, you are in the prime of health, and it feels like nothing can go wrong. Conventional wisdom states that you have no need for an insurance policy, but this isn't necessarily true. For instance, you may have accrued educational loans which you would need to pay off. It makes sense to take a term insurance policy which covers those in case of your untimely demise. It also makes sense to get an insurance policy at this age because if you have a healthy lifestyle and are in good health, you would often be assessed to have lower premiums at this stage. Thus, a term insurance policy is affordable at this early stage of your career. Further, life insurance premiums are tax-deductible, so you're actually saving taxes while securing your future.
Marriage
You have sworn to love, honour and protect your spouse till death do you part. But what if you could look after them even after you're gone? What if you could make sure that your liabilities are taken care of and your spouse's needs are provided for? What if you could ensure that your family's goals continue to be met? That's precisely what a term insurance policy can help you achieve. A term insurance policy offers a high sum assured for a comparatively low premium. Further, you and your partner can take this policy jointly so both can feel secure in case the other isn't around. There is no sweeter way to express your love and concern for them than to assure them that their needs are always your highest priority.
Children
The moment your children were born, you knew you would do anything in your power to keep them happy and safe. You want them to have the best life and education and to fulfil their each wish before they even express it. You want your spouse to feel safe knowing that the whole family is secure and well on the path to meeting each of their goals in the future. One way to do this is with a term plan that takes into account your family's increasing needs. There are term insurance plans which, with a slightly higher premium, provide increasing sum assured to account for the increasing cost of living. If your financial responsibilities increase dramatically during your policy term, the sum assured also increases automatically with each passing year to meet your growing requirements.
With each milestone, our goals and expectations change. It's only natural that our insurance plans reciprocate to these altered needs and desires. Our aim is to ensure that our loved ones meet their life goals at every stage of life, and an adequate term insurance policy goes a long way in helping them along this path, even if we aren't there to fulfil our promises to them.
The writer is appointed actuary at Bajaj Allianz Life Insurance
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