In a fast-developing economy like India, term life insurance can provide critical financial security. In the wake of the bread winner’s unfortunate and untimely demise, their dependents can have a secure life when their financial requirements are taken care of.Term insurance offers high life cover at relatively low premiums, making it an ideal instrument for securing the financial future of your loved ones in your absence. A 30-year-old healthy male without any pre-existing conditions and who is a non-smoker, for instance, can be eligible to secure a ₹1 crore cover for a 30-year term by paying a monthly premium of close to ₹1,000.In the unfortunate event of the policyholder’s demise, the proceeds of the policy can help the family meet immediate expenses, pay off debts, fund children’s education, or maintain their standard of living.
Choosing the right term insurance cover involves evaluating current expenses, liabilities, and future obligations. A common rule of thumb is to opt for a cover that is 10-15 times your annual income. But an ideal approach would be to consider Outstanding and potential liabilities, Dependents' needs and Inflation. The tenure should ideally cover your working years-till around age 60-65. If you are fit and plan on workinglonger, you may consider a higher tenure. Buying a 30-40-year plan in your 30s is an optimal mix-ensuring maximum protection at reasonable premiums.
A member of Insurance Awareness Committee (IAC-Life), said, “With increasing responsibilities, term insurance is a necessity that can secure the financial well-being of dependents and allow you to forge ahead, unhindered. With the family’s future secure, you have the peace of mind to focus on fulfilling your potential and aspirations. If you have been waiting for the ‘right time’ to buy term insurance, it is today. I urge every household to lay the foundation of their financial planning by insuring the lives of their earning members today.”