Life insurance is a financial product that has remained relevant since the need for securing one’s life was felt by individuals. However, there is much confusion about the right life insurance age limit. Several myths also abound! It is important to check the facts well before proceeding buying one. Moreover, it is vital to understand the difference between full life insurance and term life cover to obtain the right type of protection.
Sure, the term life insurance is deemed beneficial for young individuals just embarking on their careers, but the truth differs somewhat. Yes! There is a specific minimum and maximum related to the term insurance age limit. While the minimum age is obvious as the insured person is required to be 18 to be eligible for it, the maximum age is up to 65 years. The coverage extends to 99 years of age, which can be safely assumed to be for a lifetime.
An Indian citizen is welcome to go through the various notifications related to life insurance published by the Reserve Bank of India to be capable of making an informed decision.
Certain aspects that require careful consideration before buying a term insurance coverage should not be based solely on the maximum life insurance age limit. It helps to note the following facts:
Deciding the Tenure based on term insurance age limit
A term life insurance plan is usually bought as a replacement for an individual’s income after their death. It is a good idea to buy the policy for a specified number of years until retirement. This may indicate up to 55 or 60 years of age or slightly more. Insurance advisors recommend taking cover until the age of 60 or 65. Buying the plan at 50 for 15 to 20 years or when one reaches the life insurance age limit is likely to be a waste. Another aspect that needs to be considered is one’s health. Many insurance companies deny selling term insurance to individuals with serious ailments.
Benefits of buying well before the term insurance age limit
An individual in their 20s or 30s may put off buying life insurance coverage until after acquiring a family. This is, however, a misjudgement. It is best to begin planning for the future as soon as one begins earning. Waiting for too long may result in delaying the action even further. The notion of deciding that there is plenty of time after checking the life insurance age limit would be foolhardy. The prospective insurance buyer must know that term insurance is not only about financial security. On the contrary, it provides one with additional income after a specified period is completed. Other benefits that one can look forward to by buying the right term insurance cover at a young age include:
- Low premium rate
- The remote possibility of rejection
- Assurance of independent financial security
- The flexibility of adding extra benefits as Riders
- Tax saving
Benefits of buying when one nears the term insurance age limit
True, many Indians wake up to buying life insurance when they are on the verge of retirement. With health conditions being compromised and a lack of money apparent, the possibility of buying term insurance seems bright. Do seniors get a good deal by spending a hefty sum on an insurance plan? Well, this is not a million-dollar question, either. Connecting with a reputed insurance company or an independent agent can help the senior individual get the right answers. Investing in a term insurance plan is possible for individuals 60 or older.
While all insurance companies are willing to sell the policy until the prospective insurer crosses the life insurance age limit, one must be prepared to pay a lot more as a premium. Moreover, the concerned individual would have to undergo an extensive medical check-up to negate the pre-existing conditions that aggravate risk factors. Last but not least, seniors may find the sum assured to be much less than those provided to young and healthy individuals.
Despite the negatives, most seniors find the term insurance a godsend, especially when they are eager to provide for their dependents. It is best to check the products offered by Life Insurance Corporation of India before moving on to private insurance companies offering similar insurance policies.
Factors to note when buying term insurance within the term insurance age limit
- It is important to buy the policy as early as possible. This will allow one to pay lower premiums.
- Paying a lump sum is not advisable. Instead, one should opt for a plan that allows regular premium payment. This is an excellent financial planning move.
- Sure, there are multiple riders available with all term insurance policies. However, it is important to understand that each rider is available as a single investment plan and is payable before the life insurance age limit is reached. Selecting the most expensive term plan with riders is a strict no-no.
- Trying to hide an existing health condition is not advisable. The problem is sure to surface during medical examination, and the bond of trust between the carrier and insured person is lost.
- Simultaneously purchasing multiple policies will not be helpful. Having a maximum of two ongoing policies is enough! More is not necessarily better, and you may end up hindering your financial planning or fulfillment of obligations.
- It is important to plan and decide on a relatively big insurance cover. A small cover will not help one financially during times of crisis. A larger sum can provide the due assistance to the family when needed.
- It is recommended to shop for an insurance product and go with one of the best brands providing term insurance coverage for youngsters and seniors.
Opting for a suitable term insurance policy before reaching the life insurance age limit is vital to obtain peace of mind post-retirement. Checking the associated facts is essential before making the final decision and signing on the dotted line.
If you need financial guidance and assistance before buying a term insurance plan as an investment, visit Piramal Finance. This online platform helps learn everything about relevant developments in the world of finance, including personal loan, credit cards, and financial management.