Term Insurance: When To Buy And How Much Premium To Pay For Tt?

A frequently asked question is, ‘what is term insurance and which life cover should I get?’ Term insurance is a basic type of life insurance. It helps protect your family’s financial future in case something unprecedented happens to you. So, it’s advisable to get a term insurance plan early on in life, preferably one that fits your lifestyle and different financial goals. But before you buy a term plan, you should know about age limits and conditions in India to get term insurance.

Let’s look at the age limit for term insurance and learn more about it for all age groups in India.

1. When you’re 20 – 30 years old

Several people who work for a company or for themselves start their careers in their 20s and don’t have many responsibilities at first. On the other hand, some people might need to repay a student debt, providing for their family, or have other responsibilities.

Since you are in your 20s and still within the maximum age for term insurance, you can get a good term insurance plan coverage for really low premiums. A term insurance plan of Rs. 50 Lakhs or more will protect your family if something happens to you. It can help your family pay off all your debts and protect them against a potential financial crisis.

Along with a term plan for 50 Lakhs, you can also choose extra riders for critical illnesses, accidental cover, money-back premiums, and a waiver of future premiums if you get a severe illness or disability.

Keep in mind that the minimum age you have to be before you can buy term insurance may differ from one company to the next.

2. When you’re 30- 40 years old:

Once you start a family in your 30s, you have a lot more responsibilities. You may also owe money on a number of things, like a house loan or car loan. When you’re in your 30s, buying a term plan for a life cover of Rs. 1 crore or more may help you reach your goals adequately. If you pass away unexpectedly, having a substantial amount of sum assured on your life insurance policy can help your family pay off the house and car loans. It can also look after their daily needs while they take time to grieve.

3. When you’re 40 – 50 years old:

If you are over 40, you may have paid off almost all of your debts, such as loans for education, a car and even a house. But there may still be other responsibilities, like planning for retirement or taking care of medical bills. Term insurance with a life cover of 20 Lakhs or more can help you meet these needs.

To meet more extensive financial needs, you need a comprehensive financial safety net offered by a life cover insurance policy offering Rs. 50 Lakhs or more as a sum assured. This can will help protect your family’s goals, such as your child’s education, marriage and more.

4. Are you already 50? Don’t worry!

When you are 50 or older, your premium for a term insurance plan considerably rises. It is still a good idea for a 50-year-old in India to get good term insurance. You can get a term plan if you are between the minimum and maximum ages for term insurance plans.

If you buy term life insurance before you reach the age limit, the coverage you choose will help your family sustain financial surprises after your passing. Also, it can offer you some relief from medical costs arising from critical illnesses that you may face during the term of the policy.

About premium:

One pays a higher premium as one gets older because of the likeliness of contracting common lifestyle diseases. Thus, the term insurance premium paid is lower in your 20s. The premium may not change much in your 30s. But in your 40s, it is usually a little bit more than it would have been when you were in your 30s because you are now older than the midline age limit for term plans. Hence, you should buy term insurance when you are young and stay aware of the age limits if you haven’t bought one yet.

You will get certain tax benefits that come with term plans. These vary based on the plan, whether you follow the old or the new tax regime, and other factors. Nevertheless, tax benefits are less significant compared to the financial safety your family gets in case of an unfortunate event.

You can use a term plan premium calculator to figure out how much term insurance premium you have to pay to get a specific life cover. It will give you this estimate against the data you provide. It considers various factors, including your age, gender, income, current health, lifestyle habits and more.

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