Life cover insurance helps accomplish different types of objectives. As your parents’ age, their routine expenses and medical expenditures keep varying. If you are responsible for their well-being, you can certainly purchase a life insurance plan for them. Life insurance is one of the ways to ensure that your parents are financially secure. Nowadays, there are so many plans for senior citizens available in the market, and you can choose a plan that will help your parents even in your absence.
Before we get started, let us understand what life insurance for parents is.
What is Life Insurance for Parents?
A life cover insurance for your parents is an agreement between you and your insurance provider wherein your insurer will provide a life cover and maturity benefit. You can customise the life insurance plan by enhancing the benefits by purchasing add-on riders#, receiving the death payout as a regular income, etc., to ensure maximum benefits.
Can I buy a Life Insurance Plan for My Parents?
Yes, you can buy a life insurance plan for your parents. But, to buy a plan for your parents, you need to have their consensus. You also need valid proof of insurance interest. This might be difficult to prove. It is better if you help your parents in applying for a life insurance policy that lists you as a beneficiary. Also, you can continue to pay the premiums for your parents’ life insurance policy.
Factors to Consider When Buying Life Insurance for Parents
While buying life insurance for parents, you need to consider certain factors to ensure the product serves your financial needs essentially. Here is a detail for your reference.
- Age - Age is one of the most important factors to consider while purchasing a life insurance policy for parents. You can determine the policy tenure and the premium based on age. However, with the increase in age, the premium will also increase, considering the rising health issues and the death risk.
However, if you purchase life insurance for parents over 60 years or so, you need to review the features to understand if they will suffice for your needs. For example, you have to confirm with your insurer if you can avail of additional rider# benefits, the age up to which renewal of the life insurance plans is permissible, etc.
- Health condition - Life insurance plans are customisable. You can enhance the payout benefits by opting for add-on rider# benefits based on your parent's health conditions.
In addition, you can receive the payout as a lump sum, regular income, or as a combination of both regular income and lump sum. Therefore, if your family has a history of getting affected due to a major illness such as cancer, you can purchase life insurance with the rider# benefit. It will provide a fund or regular income to manage the medical expenses related to the treatment for your parents at any time during the policy term.
- Waiting period - Every insurance provider will have a waiting period after which you can realise the benefits from the life cover insurance plan. You can claim the policy benefits only after the set waiting period. The waiting period differs from one insurance provider to another. For example, it can range between 30 days to 180 days for life insurance or term insurance for parents.
- Lifestyle and habits - Another major consideration in purchasing a life insurance plan for parents is their lifestyle and habits. You should inform your insurance provider if your parents are addicted to smoking or drinking alcohol. They will analyse the situation and the health condition to determine the premium. If you disclose this information to your insurer, the life insurance claim can get rejected in the event of your parent's unexpected demise.
Why is it Necessary to Purchase a Life Insurance Plan for Your Parents?
A life insurance plan can ascertain varied benefits during the policy tenure. Here are a few pointers to explain the necessity.
- Provides financial assistance in any medical emergency related to a disease or illness during the policy term. It is of utmost need if your parents are having consistent health issues.
- Your parents might have availed of loans for varied purposes during their lifetime. You can utilise the death benefit from the life cover insurance plan to clear off such debts.
- Keeping the emotions aside, you must have spent huge funds to take care of your parents during extreme medical emergencies or even otherwise.
Therefore, you can compensate for such expenses by receiving the death benefit in the event of their unexpected death. If you feel you may not be able to utilise the lump sum wisely, you can opt to receive the benefits as a regular income.
- If you opt for a life insurance plan with maturity benefit, your parents can use the maturity amount to fulfil their post-retirement expenses.
At Tata AIA, we provide online life insurance detailing the policy features and benefits. You can browse through the features, compare costs, and determine the most affordable premium for increased benefits. Purchasing online life insurance can be comfortable and cost-effective.
Purchasing a life insurance plan for parents can ascertain varied financial benefits. It can provide a lump sum in the event of their unexpected death to handle any critical financial situations, pay for their medical expenses utilising the add-on riders# and help secure your financial position at any time.