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Illnesses, accidents, death and similar misfortunes always come uninvited. These are situations nobody wants to face but you will face them sometime in your life. While you cannot prevent their occurrence, the least you can do is to ensure that your family’s needs are taken care of even when you are not around, and minimize their suffering. For example, if you build a house early in life, your family will have a home to live in for their whole life. If you invest and save money, your family will be financially secure.
Life insurance is one such important tool that provides much needed finances for your family when you are no more there to take care of them. It is a time when besides the emotional turmoil the family’s income too ceases if you are the only earning member. When the family will need money in lump sum during key milestones, such as college education, marriage, and so on, Term life insurance will come to their rescue. When you are living, it provides you necessary peace of mind thinking about your family’s situation after your demise.
As a life insurance Policy is typically bought to protect family from financial crisis in case of early demise of the earning family member, it is essential that you plan and purchase the policy. There are a number of factors that you need to keep in mind while you get a life insurance policy. The time period for which you require life cover is one of the most important factor. Various other factors are explained here.
At what age you should buy the policy, which determines the term of the policy. What should be the term of cover, which is the time period for which you require life cover. The ideal amount of sum Assured that can meet your family’s needs in case of your early demise.
Till what age you need the policy so that you can have some financial help after retirement. You should compare life insurance policies in India before you purchase one. Getting online life insurance will help you get the best life insurance, especially using insurance aggregator sites.
For example, you may like the policy term to end when your child attains the age of 25 and enters a job. The family will then not be completely dependent on your income. In case you are purchasing the policy at the age of 30, you should then have the policy term till you attain the age of 55. Thus, the policy term will be for 25 years.
In case you are planning to use this amount for your post retirement life, you should then factor in this too in your retirement planning. Post retirement, your income will come from your inherited property, savings, insurance plans etc. Thus, 25-30 years is the ideal time frame for which you need life cover, in case you purchase the policy when you are 30 years of age.
The number of years after which you will retire should be the cover period for your life term policy. This is because, life insurance policies are basically meant to provide financial cover for your family atleast till your retirement age. In case you already have life cover and are planning to take additional policies, and are just few years away from retirement, the number of years left for retirement could be the term of your new policy.