Starting a family is one of the most exciting moments in life, but it also comes with responsibilities, including financial security. Term insurance plans are important to ensure your family’s financial security. However, this is a type of life insurance that covers you for a specific period, or “period,” and pays your family an amount if something happens to you during that time. For young families, this is especially important and here’s why.
Benefits of term insurance for young families
Below are some convincing examples to help you understand the importance of term insurance plans for young families.
1. Provide financial security
Term insurance plans are primarily beneficial because they provide financial security for your family in the event of your passing. Without term insurance, your family may have difficulty paying off debts and other expenses after your death.
In addition, term insurance provides the nominee with a lump sum that can be used to pay off debts, cover ongoing expenses, and maintain the same standard of living. This ensures that your family will not face financial hardship if you pass away.
2. Health checkup
Term insurance often requires a medical exam, especially for high coverage amounts. However, many insurance companies are making it easier for young couples to get insurance quickly by offering simplified medical exams and lower coverage amounts for younger, healthier applicants. . It is important to disclose any pre-existing health conditions as they will be factored into your insurance premiums and coverage.
3. Affordable coverage
term insurance plan It is often the most affordable type of life insurance available. Because it only provides coverage for a specific period of time (10, 20, 30, etc.), the premiums are lower than other insurance types such as whole life insurance. For young families just starting out and on a tight budget, term insurance can be a cost-effective way to provide coverage.
4. Customizable policies
Term insurance can be customized to suit your needs. You can choose how long you want coverage (for example, until your child graduates) and the amount of coverage you need based on your current and future financial obligations. This flexibility allows young families to design a policy that suits their requirements without overpaying for unnecessary extras. For added protection, you can also choose additional riders such as accidental death insurance or critical illness cover.
5. Tax benefits
The premiums paid for term insurance plans are eligible for tax deduction under Section 80C, subject to a limit of ₹1.5 million 50 million rupees, like any other eligible investment. Furthermore, provided that certain conditions are met, the death benefit received by the nominee is tax-free under Section 10(10D).
6. Peace of mind
Raising a family comes with many concerns. Your family’s financial future should not be in it. With term insurance, you can rest assured that your family will have enough money even if you die. This peace of mind allows you to stop worrying about the future and focus on living life to the fullest and creating memories with your loved ones.
conclusion
Term insurance is necessary for all young families with dependent children or parents. You can have the peace of mind that your family will be financially secure even when you are away. Low premiums, high coverage, tax benefits, and easy medical testing make term insurance very convenient for young families. It is one of the best ways to protect your family’s future. So, once you start a family, consider purchasing a term plan so that your family can have peace of mind even when you’re not around.
Suresh KP is the founder of Myinvestmentideas. He is a NISM Certified – Investment Advisor and a NISM Certified – Research Analyst. He has been analyzing financial markets for the past 20 years. Contact him at suresh@myinvestmentideas.com.
