You must buy a term insurance policy whenever it is possible for you. However, if you are young and planning to purchase a term insurance policy, you will get better benefits without any doubt. Life is unpredictable, we all know. And especially when we are in mid of a pandemic, can there be any good reason for pushing away the idea of buying a term insurance policy? Let us discuss the reasons why you should purchase a term insurance policy when you are young.
Lower Premiums
The earlier you buy a term insurance policy, the better it is for you. One of the main reasons for that is saving on premiums. If you are in your late 20s or even early 30s, you are likely to pay much lower premiums for the term insurance plan you have bought, as compared to an individual in his late 30s or early 40s. The main reason behind buying term insurance is to get a good amount of money for your family when you are not around. Well, in that case, why not start it when you have much lesser health issues and when you have your life ahead of you? As a matter of fact, when you get older, you have more responsibilities to take care of. If you buy it when you are not even married, you can take a term plan that you know you can afford in the future, and which will give you better returns. Also, as you start getting older, the premiums you will have to pay will cost you more. To sum it up, if you buy a term insurance plan as soon as you become financially independent, you will get better benefits in terms of paying a lower premium.
Lesser Rejection Rate
When we grow older, we start suffering from various types of diseases. Some people even suffer from critical illnesses. And the treatments of these diseases may almost burn a hole in our pockets. As the term insurance plan is concerned; if you already have a pre-existing disease, your application is likely to be rejected. On the other hand, young people are less prone to diseases and the majority of them do not have any pre-existing disease. Therefore, the chances of rejection of the term insurance application are also very less. If you do not have any disease yet, you can go ahead with the buying process of a term insurance policy of your choice. There is absolutely no need to take the stress of your application getting rejected.
It Helps To Save Taxes
On your sudden demise, your family will of course be devastated but the amount of sum assured can at least help them to take care of their finances. However, if you are wondering if the policy will give you any kind of benefit while you are alive, you need to know that it can help you save your taxes. The premiums that you pay for the term insurance plan that you purchased, qualify for tax rebate under 80C of the Income Tax Act, 1961. The maximum limit that you can avail of tax benefit is up to INR 1.5 lakhs.
For example, if you purchase a term insurance policy for which you pay an annual premium of INR 12,000; you will get a 30% tax rebate. This means you will be able to save at least INR 3,600 of the INR 12,000.
Even the death benefit that will be received by the beneficiary of the term insurance policy on your untimely demise is exempted from tax under Section 10 (10) D of the Income Tax Act, 1961.
Flexibility To Add Other Benefits
A term insurance policy is not only helpful when you are not there with your family; it also gives you various other benefits. You can buy riders by just paying extra premiums and can enjoy several benefits. Some of the add-ons include critical illness rider, waiver of premium, income benefit rider, accidental death benefit rider, etc.
Nevertheless, before you buy a policy, you can check the term insurance age limit that is eligible for that policy. The next thing that you should check is the number and types of add-ons you are getting with the specific term Auto Service Repair Shop insurance plan. And to find almost all the term insurance policies under one roof so that you can compare them and then make an informed decision, you can visit the IIFL website.
