Life and decisions can never be pre-planned! Nevertheless, the decision that is finalized is also susceptible to extreme changes. However, a basic preparation to protect your loved ones becomes an ultimate necessity. And the life insurance term policy is the best-suited product for your advantage and maximum protection. Here is an article about the term insurance and should you buy it even if you don’t have dependents.
What is a Term Insurance Plan?
Term insurance is a pure life insurance plan that provides a death benefit to your nominee in case of your unexpected death. The term policy does not provide maturity benefits. However, it offers a range of benefits that requires special mention. For example, Tata AIA term insurance provides extensive flexible features that help you customize the policy as per your financial requirements.
Benefits of Term Insurance Plan
The following are some of the most important benefits that require special mention.
- Term insurance plans are available at a reasonable and affordable premium.
- Option to choose different payout options such as a lump sum, regular income or a combination of both.
- Option to increase the coverage at different stages in life.
- Enhanced riders for additional financial support.
Having understood the benefits, let us understand the reasons to buy term insurance even if you don’t have dependents.
Why Should You Purchase a Term Policy Even if You don’t have Dependents?
Here are a few factors that suggest the need for purchasing term insurance even if you don’t have dependents:
- Age factor – A term policy is extremely cost-effective when you purchase it early in life. Insurance providers consider your age, pre-existing illness and other health issues while considering the risk of death for deciding the premium amount. The possibility of having such health complications is extremely less at a younger age, and thus the cost of the term plan becomes lower. Therefore, if you have dependents later in life, purchasing a term insurance plan becomes difficult due to the increased cost.
- Changing life decisions – Decisions in life keep changing at different stages in your life. Here are a few scenarios that explain it better.
- It may seem easy to decide and stay single throughout your life now. However, with changing life scenarios and people you encounter, you might decide to get married. And, your life partner may not be employed and become your dependent by default.
- Suppose you get married to an employed person, and you both mutually agree to have no kids. In that case, a life cover may not be necessary. However, with time you might start family planning. The life of that child will become your responsibility in future, even in your absence.
- If you have increased liabilities such as a car loan, home loan etc., it shouldn’t become difficult for your old parents in your unexpected absence later in life. It can deplete their retirement funds, making life impossible for survival. With the lump-sum death benefit, your parents can clear off the debts considerably with ease.
- Protecting parents – Your self-sufficient parents now can become your dependents if they have not done adequate retirement planning. Therefore, taking care of your parents as they get older becomes your primary responsibility. In your absence, with the regular income payout option, you can ensure a reasonable fund for their basic utility expenses.
Conclusion
A term insurance plan will make your life responsible and prepare you for any unexpected and changing life scenarios. Based on the average life insurance payout, you can decide on the ways and means to manage your liabilities for your parents in case of your absence. Furthermore, you can accommodate any dependents if you have planned the investment on the term policy at a younger age. Therefore, plan early, stay invested and ensure extensive protection at a lower cost!