Young boys and girls in their early 20s who have just started working hardly think about purchasing an insurance term plan. Most think that they are young and do not have any liability, so why waste money? Therefore, such decisions are generally deferred to later stages of life. On the other hand, there are not too many people to advise them on financial planning and benefits of the purchasing a term plan of high sum assured when they are young. This blog is going to exactly do the same.
There are more than one reason to purchase an insurance term plan of high sum assured at an early age. At a younger age, the premium is cheaper. It is found based on the latest mortality table published by the Institute of Actuaries of India 2012-14 that 931 people will die between age 25 and 26 out of a million people. This increases to 2579 deaths between age 45 and 46. This indicates that the premium is likely to be more than double when you purchase a policy at the age of 45 compared to age 25. So the cost of the product is a big driver in case of term insurance plans.
The onset of most of the dreaded diseases start post the mid-30s when sedentary life kicks in post marriage and kids. This would mean that a term insurance plan in the late 30s and early 40s will not only cost more but also require more medical tests because a customer might have got some disease like diabetes, hypertension, stress-related diseases etc. So, an early age induction into the term plan is a very sensible option.
Also, if a customer is deferring purchasing term plan later in life, it would mean that the opportunity is getting lost to cover their families. In the above example, 931 out of million people die between age 25 and 26. So if the protection is not taken by these 931 people, they have lost the opportunity to cover their families.
It is therefore recommended to buy a term plan with your very first salary for the safety and better future life of your entire family. Every increase in age is going to cost more, require additional medical requirement and will be an opportunity lost to protect your family. Hence, wait no more and take one now!