Buy a term plan and secure your family
The trail of life is long and goes through a rollercoaster of ups and downs that are filled with surprises, some pleasant and some distressing. The only way out is to prepare well and this where Term Life Insurance comes into the picture.
With the right insurance plan in place, you can safeguard your loved ones against uncertainties and live your life to the fullest. Undoubtedly, term life insurance is one of the most important purchases one makes, and therefore it is crucial to choose the right product.
But how do you find the right policy that matches your budget and fulfills all your requirements?
The insurance market is massive and might appear complex at first which is one of the main reasons a lot of people struggle while choosing the right term life insurance plan in the UAE. Mainly, life insurance plans can be divided into two types i.e. term insurance plans, whole life insurance plans. Further, there are various sub-divisions of these main two types based on the features, advantages, and demerits of the policies.
Very often, a lot of insurance seekers are confused about increasing and decreasing term life insurance plans. So, let us quickly understand what are these insurance plans and how do they work?
The concept of increasing and decreasing term life insurance plans is quite simple, they adapt to various changes in the life of the policyholder. To keep it simple as our life changes or we age our set of insurance needs also changes simultaneously.
And these insurance plans take care of your needs at all stages of life.
In case of an increasing term life insurance plan the total coverage offered by the plan keeps on increasing annually and as a result, the monthly premium is also increased. On the other hand, in case of decreasing term life insurance plans, the cover is reduced annually and therefore the premiums are reduced.
Both types of term life insurance have different utilities and turn out to be beneficial in diverse situations that are usually opposed to each other. For instance, decreasing term life insurance plans are purchased by people who are dealing with mortgage payments. Contrary to this, insurance seekers looking forward to leaving a legacy for their loved might prefer increasing term life insurance plans.
If your objective is to repay an outstanding financial obligation and you’re purchasing insurance to safeguard your loved ones against the debt then decreasing policy is the right choice for you. However, if you have a steady source of income even after retirement possibly in the form of rent, or investment plan then you can think of going for an increasing term policy. These plans are excellent choices to safeguard the future of your dependents by providing them strong financial support.
Choosing the right insurance plan seems like a tedious job, but with the right knowledge and analysis, you can easily decide which one is the right choice for you?
Before you choose one of these it is vital to assess your current insurance needs along with a projection of what you will be needing in the next 20 years or so. With a clear picture of your long- and short-term goals it will become easier for you to choose the right term life insurance.
For example, if you settled children and your motive behind opting for insurance is to cover your outstanding debt, then decreasing term plans are suitable for you. With time your coverage will decrease gradually which will reduce your premiums as well allowing you to save more. Decreasing term life insurance plans are ideal in preventing over-expenditure.
Typically, increasing term life insurance plans are less popular due to their limited utility. However, if you project your life insurance need to increase exponentially in the coming years then you should go for them. These plans are suitable when buyers want to save money currently but at the same time want to build financial protection for the next decade.
In a Nutshell
Term Life insurance is an absolute must in order to provide financial protection to your loved ones during the phases of instability. The loss of a loved one not only affects one emotionally but in quite a lot of cases it affects them financially as well. Especially if the deceased was the sole breadwinner of the family.
Therefore, to secure the future of family members and to ensure that don’t struggle when you are not around, term life insurance is the ideal solution. Before you go ahead and get an insurance policy for yourself, you should compare and assess different products and providers based on your need and budget to get the best term life insurance in the UAE.