Why Opting for a Term Plan at an Early Age is a Great Idea?

  | Published: 14 March 2020 | Last Updated On: 08 February 2021

Buy a term plan and secure your family

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Ahlam, aged 27, is an IT professional who resides in Dubai and he is in pink of his health. He is well-established and working with a leading IT company. While he is busy and enjoying his life to the fullest, the purchasing term plan would probably the last thing in his mind.

Well, there is an array of working professionals like Ahlam in the UAE, who have the wrong perception that term life insurance can wait till they reach some specific age.

But with time your responsibilities in life also grow, and you finally begin to understand that you’re not alone. There might be some people in your family such as your parents, spouse, and children who are financially dependent on you. At present, you may financially stable to take care of yourself and your loved one’s financial needs.

But with the growing age, some health-related issues may start after you cross the age of 40. And it is certainly the age when you also start thinking about what if you were not around for your loved ones tomorrow. The thought of leaving your dear ones in a financially deprived start is the worst nightmare anyone could have. So, do you have any alternative plan that will take care of your family when you are not around? Since a single tragic incident can put your family’s lifestyle as well as the financial future at great risk.

This is where the term plan comes into the picture. An adequate term insurance policy helps in fulfilling your responsibility. Once you opted for the right term plan, you are fulfilling some of your responsibilities beforehand.

What is the Term Plan?

A term plan is a type of life insurance policy that offers coverage for a fixed term. If the policyholder dies within the tenure of the policy, a death benefit i.e. sum assured is paid by the insurer to the beneficiaries nominated by the policyholder. It is advisable to buy term insurance plan as soon as possible in order to reap its benefits. However, the main reasons to opt for a term plan are not only about ensuring the financial protection of your loved ones in your absence but also to be well-prepared in advance with comprehensive coverage. So, read this article further to know 5 important reasons why you must purchase a term life insurance plan sooner than later and what are the benefits associated with it.

Here Are the Reasons Why It is Better to Buy a Term Plan at an Early Age

Lower Premium Cost

If you think that opting for a term life insurance before you hit the age of 25 is too soon, then you are wrong here. It is believed that the younger you are, the healthier you’re. As you grow older, you’re at high risk of contracting critical illnesses like thyroid, diabetes, high or low BP, heart disease, cancer, etc. Also, some lifestyle disease that may be caused because of the mundane 9 to 5 work life.

Hence, when you opt for a term plan when you are free from such critical illnesses, you can protect your family’s wealth at an affordable premium cost. With the growing age, the cost of the premium will also rise. Also, if you wait for a couple of years and by that time, you find yourself suffering through critical illness or a lifestyle disease, chances are high that insurance provides might reject your application or significantly hike your premium cost on the basis of your pre-existing medical condition. Thus, being the sole breadwinner of your family, you should purchase a term plan as soon as possible. It will safeguard your family’s future wealth that they deserve in an unforeseen event.

Offers Financial Protection to Dependents

Whether you are a man or a woman, if you are the sole breadwinner in your entire family, your absence might cause huge financial distress to your family. Your dependents – be it your parents, your wife, or your children will have to bear the financial burden of paying off your education or home loans. Also, they might have to confront difficulty in managing their daily expenses without your contribution.

So, if you don’t want to leave the financial burden on your family’s shoulder, opt for a term plan as soon as possible in order to cover the risk of paying off loans and manage the day-to-day expenses of your family in a case where you are not around.

Term Insurance Plan by Your Company May Not Sufficient

You may be at the peak of your career during this period of age and you might be thinking about switching jobs in order to get better opportunities. Or you might be thinking about starting a new business. Term life insurance plan offered by your company may not sufficient or portable and you will not get the coverage anymore as soon as you move to other company. Henceforth, it is very imperative to have your term plan before you hit the age of 30 or 40 since you will get the plan at an affordable premium cost at this age and also offers the best risk cover for your dependents.

Ensures Peace of Mind

While we wish nothing uncertain happen to you, turning 40 brings several changes in our lives. You can never predict that when life throws a surprise at you. Henceforth, it is always wise to be well-prepared in advance for the worst situations in life. By opting for an adequate term life insurance plan, you do not only ensure the financial protection of your loved ones but also you are buying peace of mind that your loved ones will not have to suffer through financial distress in your absence.

Flexibility to Add Riders

In addition to the death benefits, there are several other incidences where the term insurance plan proves to be a lifesaver. And to enhance the benefits of your term plan, you can opt for riders. But note that the eligibility to purchase riders or add-ons will solely depend on your health and age. It is much easier to buy riders such as waiver of premium, income rider benefits, and accidental death benefit if you are in your pink of health or you are at an early age.

For example, in case of loss of income and accidental disabilities, your term plan will provide you the supplementary income. You can also buy a rider to avail of a lump sum amount in an event of a diagnosis of a critical illness. Do you feel financially secured already? Of course, you must be feeling that way. But sadly, once you cross some specific age, you may no longer be eligible to but such riders with your term plan. This is also one of the main reasons that buying a term plan at an early age is important.

Closing Thoughts

A term plan is by far the best type of life insurance policy in order to secure the future of your loved ones financially when you are not around. It is very imperative for you to buy it sooner than later so that you can reap the benefits of comprehensive protection and affordable premiums.