Young and Unmarried? Should You Buy Term Insurance?
Updated On Jul 26, 2021
Table of Contents
A life insurance policy is not just for married individuals with children who want to protect their families financially when they die. Single folks with parents and loved ones can benefit from it as well. Furthermore, purchasing a term insurance policy at a young age is recommended to have high coverage and reduced premium rates. So if you are young and confused about whether to purchase a term insurance plan or not, this article is for you.
Why Should Young and Unmarried People Buy A Life Insurance Policy?
Here are seven compelling reasons for young and unmarried people to purchase a good term insurance policy.
1. Financial Security of your Loved Ones
Human beings spend their lives forging meaningful connections and bonds with others. So, if anything happens to you, your parents, siblings, children, friends, or relatives who are emotionally and financially attached to you will be significantly affected. Hence, a life insurance policy is a great approach to ensure that their lifestyle and future objectives and aspirations are maintained.
2. Low Premium
It is common for people to purchase life insurance later in life. However, it's a good idea to buy a suitable insurance policy as soon as you start making a steady income so you can receive a lot of coverage for a reasonable premium. You can even compare numerous insurance policies to get the one that is best for you.
3. Family History of Diseases
Patients and their families can be emotionally and financially drained by the high costs of severe medical issues. So, if you have a family history of critical illnesses such as heart disease, cancer or kidney failure, the additional rider benefit of critical illness cover on your life insurance policy can assist pay for hospitalisation, medical care and treatment, post-hospitalization fees and care, and so on.
4. Loan/Debt Repayment
If the life assured dies before the debt is repaid, a term insurance policy could be used to pay off debts such as a student loan or a home loan. This way, you can ensure that the financial weight does not fall on your parents' shoulders, who are already grieving. Hence, to get the most out of your term insurance, it's a good idea to think about your loan payback commitments while choosing your coverage and term length.
5. Tax Benefits
A term insurance policy, in addition to providing financial stability, also provides tax benefits according to current tax regulations. The premium paid for a term insurance policy is eligible for a tax deduction of up to Rs 1.5 lakh under Section 80C of the Income Tax Act, 1961. Similarly, under Section 80D, you can claim tax savings of up to Rs 25,000 for critical illness benefits. Furthermore, if the life assured passes away within the policy tenure, Section 10 (10D) of the Income Tax Act exempts the beneficiary from paying taxes on the death benefits.
It is never too late to begin making better financial decisions. In fact, it is believed that the sooner you start, the better the benefits will be. Moreover, if you have any questions, you can always talk to a financial advisor or an insurance agent. So, begin investing now to ensure a brighter future for yourself and your family.
- Common Features of Term Insurance Plans That Must Know About
- Term Insurance Riders and Their benefits
Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.