People in their early 20s possibly enjoy the best time of their lives. They are young, healthy, have a good income, and relatively fewer responsibilities. Concepts like savings, investments, retirement planning and insurance are not on the horizon for most of them. They usually think, “I make enough money. Why do I need an insurance policy?”
However, if you ask financial advisors, they’ll recommend the exact opposite of this. Though the term insurance age limit in India is 65, it’s recommended that a person should buy it as soon as he/she starts earning. The primary advantage of this is that by buying a term plan at an early age, one can get it at relatively low premiums.
Another advantage is that by starting early, the policyholder can create a large corpus by the time his/her policy matures. Below are the reasons buying early is considered best for term insurance:
It’s easier to buy term plans early: All reputed insurance providers have interactive company websites that facilitate the purchase and renewal of insurance plans. Since, the premium for term plans are quite low, many insurers allow the policy to be purchased online without a medical check-up. Therefore, if you’re aged 18 or more, which is the minimum age for term insurance in India, you can buy the best term insurance policy sitting at home or from your office during the lunch break.
Buying term plans early results in lower premiums: One of the reasons why 20s is considered the best age for term insurance purchase is that it can result in cheaper premiums for the policy buyers. Insurance providers offer lower premiums when you are in your 20s. This is because at a young age, you are fit and at lower health risks. Also, since the operational costs of processing the policy online are lower, term plans purchased online are cheaper.
Your dependents will be cared for in your absence: No matter what the term insurance age limit is, you should buy it by the age of 25. You may not be married and have a family at this age, but you will certainly have parents and younger siblings who might be dependent on your income. Moreover, you are going to get married in the near future and will have a family of your own. What will happen to them in case of your untimely demise? Having a term plan can save them from financial instability by helping them to lead comfortable lives even in your absence.
Thus, buying term insurance at an early age comes with dual benefits of being pocket friendly and providing complete financial protection to your family.