4 Reasons to Buy Term Insurance Even If You Are Single
Life is very uncertain, and it gets even more unpredictable as you get older. Given that, it is always better to be ready to deal with any possibilities. Since, one of the biggest and most recommended purchases at a young age is said to be a term insurance policy, you need to know what it is and why you should buy it as soon as you can.
A term insurance policy is a financial product that offers life coverage. This coverage offers your family a lumpsum payout of money in case of your sudden death. The exact amount of the payout is set at the time of buying the policy and is known as the sum assured.While you considered the policyholder, the policy has a nominee that the money will be given to after your death. This nominee is selected by you. Usually, the nominee is a spouse or your children, but you can appoint other relatives as nominee as well.
Why You Should Buy Term Insurance at a Young Age?
- Affordable
Any type of insurance you buy, the price is a big factor in your selections. This applies to the term policy as well. The premium for an online term plan is determined by taking a lot of factors into consideration. These factors include age, lifestyle habits and health. At a young age, you are likely to be healthier and more active. So, insurance providers consider these factors favorable for you to offer a good premium. On the contrary, as you grow older, newer health issues arise and you become less active. As a result, the premiums offered are often higher. Hence, you should buy a term policy at a young age.
- Lowers taxable income
Everybody wants to save money on taxes without having to deal with any legal trouble. Especially at a young age, the limited income that you have, you wouldn’t want to spend it on taxes. Hence, a lot of people use different ways to get tax deductions. A term insurance can be extremely helpful in that case. Regardless of the plan you choose to buy, you qualify for a tax deduction under Section 80C. As per this section, you can claim a tax deduction of up to ₹ 1.5 lakhs in a financial year. Moreover, section 10D also makes the payouts received from the policy exempt from income tax.
- Peace of mind
A term insurance helps both you and your family. While its main purpose is to financially cover your family if you die, it also helps you by giving you a sense of peace that your family is protected. Both these benefits are extremely important to have in life. Hence, it is important to seek them as early in your life as you can. It also offers other term insurance benefits like accidental death cover and critical illness coverage. This only makes buying term insurance more worth it.
- Debt security
Everybody takes a loan at some point in his or her life. Whether it is for a car or a home, you will have to borrow money for something in your life. Moreover, you would also have to repay these loans on a regular basis. When you are young and single, these loans are maybe the only major expense for you. However, with a family, these actually feel like a major liability. Managing them while paying for your family’s needs is a challenge. In such a case, if you die, your family is left to repay these loans.
With term insurance, they can easily receive the payout and then use it to pay off the home loan. Moreover, many insurance providers offer special benefits to its policyholders in the field of debt security. This means you should buy term insurance as early as possible.
If there one thing that everybody knows, there is no telling what the next day will bring. While it is often used as a statement to induce positivity, it can also mean that bad things can happen at any time. Although you may not be able to predict and have a solution for all of them, you can definitely protect yourself from them. Hence, it is advised that you should find the right policy for yourself and buy it as early as you can in life.
