The Early Bird Gets the Worm:The Importance of Securing Term Insurance Early

Securing term insurance early is vital in protecting yourself and your loved ones. Term insurance provides life coverage for a specified period, like 10, 20, or 30 years. It is generally less expensive than permanent life insurance and can be a great way to ensure that your family is financially protected during your death. For the most affordable plans, you can look up online term insurance and choose to purchase it as early in your life as possible. This article will examine the reasons for buying a term plan early in life.

Why should you obtain term insurance early in life?

To reiterate the term insurance’s meaning, it is a pure life cover that is purchased for a specified period. It pays out a sum assured to the policyholder’s nominee in the event of the former’s demise within this tenure. Here are some of the reasons why taking a policy early in life is essential: 

1. Lower Premium Advantages- One of the main benefits of securing term insurance early is that you can lock in a lower premium. As we age, our health risks increase, and insurance companies consider this when determining the cost of a policy. If you secure a term insurance policy when you are young and healthy, you can lock in a lower premium for the duration of the policy. This can help to keep your insurance costs down over the long term and can be an intelligent financial decision. In addition, by buying term insurance early, the term insurance coverage will last longer.
2. Financial Security For Dependents – Another benefit of securing term insurance early is that you can protect your loved ones while they are still dependent on you. If you have a young family, it is especially important to have life insurance in place in case something happens to you. A death benefit can help to cover the costs of daily living expenses and other financial obligations, allowing your family to maintain their standard of living even if you are no longer there to provide for them.
3. Securing the Achievement of the Family’s Long-Term Goals – Insurance plans may sometimes help families achieve long-term financial goals. In case the policyholder is no longer around, the family can still achieve goals like the higher education of children, investing in a new house, weddings, and so on, with the sum assured payout.
4. Lower Chances Of Rejections – When you purchase the term insurance early on, your chances of being rejected to obtain a policy are very low. Typically, applicants for term insurance who are older than 60 or those who have been diagnosed with severe illnesses like cancer are turned down by insurance providers. So, if you purchase term insurance when you are young and healthy, you can do so for less money.
5. Get Higher Coverage – In addition, it’s important to note that the sooner you get term insurance, the more coverage you can get for your premium. Buying life insurance at a younger age enables you to get more coverage for a lower cost. If you purchase long-term coverage lasting for 30 years, you may relax knowing that your family’s financial future is safe for the longest time with a sizable coverage amount to take care of your needs.
6. Tax Benefits – All term insurance plans provide tax benefits under the Income Tax Act’s Section 80C (premium payments up to ₹1.5 lacs can be deducted) and Section 10D (death benefit is tax-free). Getting a term plan early in your professional life can be a prudent tax planning decision and help you save taxes in the long run.

Securing term insurance early can also be a wise financial decision because it can help you avoid being denied coverage later. Certain health conditions or lifestyle choices can make it difficult to secure life insurance later in life, and if you cannot secure coverage, your loved ones may not be protected in the event of your death. 

Note that if you are working as a salaried employee, you may have coverage under a group term plan provided by the employer. However, you should be aware that such plans only pay a small amount of money upfront, which cannot always be enough to support your family after you pass away. Additionally, after you leave the company, your insurance coverage will end. This implies that in the event of your passing, your family will be financially vulnerable in such cases. Therefore, buying an individual term insurance policy early on is preferable to avoid such terrible circumstances, ensuring that your family has sufficient financial coverage in the future, irrespective of group term insurance provided by your employer. 

In conclusion

securing term insurance early can be an important step in protecting yourself and your loved ones. Locking in a lower premium early on can reduce your insurance costs over the long term. This is a wise move, considering all the above-mentioned aspects.