Life’s milestone events bring joy, but also give rise to added responsibilities and financial obligations. It is the same on every occasion, such as completing your education, getting married, having children, buying a new car or house, or planning for retirement. The burden of such liabilities might cost you your hard-earned savings and your peace of mind. Here is where a life insurance plan can help, providing financial support through every stage of your life.
 

With each phase, however, as your needs change, your life insurance needs change as well. Read on to understand how you need to add to your life cover through changing phases of life.
 

Life insurance needs at different stages in life.
 

18-25 years
 

At this age, you may not feel the need for life insurance or think it too early to buy one. Since this age may not involve too many responsibilities or health complications, it is natural to think this way. However, it is cost-effective to buy life insurance policies at an early age. Insurance companies offer low premium rates to young proposers.
 

What life insurance plan will you need?
 

At an early age, a term insurance plan will work well for you. These pure life insurance plans carry no risk. Your nominee receives assured payouts in case of an unfortunate event. You can also increase the coverage in the future.
 

25-35 years
 

At this age, a new chapter of your life, like welcoming a new life-partner or a child is likely to occur. You may have to shoulder the responsibility of caring for your retired parents or siblings. At such a time, life insurance becomes essential to ensure your family’s continued well-being.
 

What life insurance plan will you need?
 

Getting life insurance under 40 can help you build a sizeable corpus to meet your increasing requirements. During this stage of life, a Unit-Linked Insurance Plan (ULIP), also known as wealth creation plans, works . Such plans give you the dual benefit of life coverage and investment returns. The insurer invests a portion of your premium in debt and equity funds, as per your risk appetite. You get a share of the profits as fund units as per the premium you pay. On long-term investments, you can earn substantial returns from ULIPs.
 

35-50 years
 

During this phase, you may face the costs of funding your children’s education or marriage, paying off a car or a house loan, or bearing the expenses of your parent’s healthcare, among others. Moreover, an unexpected critical illness can also pose more financial challenges.
 

What life insurance plan will you need?
 

Here too, a ULIP would serve your needs.
 

Tata AIA Life Insurance has a ULIP that provides:
 

• Flexibility to choose from 11 fund options
• Sum assured amounts up to 15 times the total annualized premium paid
• Option to add a waiver of premium benefit that writes off future premium payments on permanent total dismemberment or death due to an accident
• The provision for an accidental death and dismemberment rider* for extra payouts in case of an accident
• The choice to receive the maturity amount as a lump sum or periodic instalments
   

50 years and above
 

At this age, you might be planning to retire and spend your golden years in leisure and financial security. You might also have to incur the costs of your or and your spouse’s healthcare. Therefore, your life insurance plan will have to give you a steady flow of income for life.
 

What life insurance plan will you need?
 

During this time, a retirement plan or a savings plan will suit your needs. Such plans safeguard your capital and provide periodic payouts to help manage your finances.
 

How to determine how much life insurance you need?
 

To determine your life insurance needs, you should consider the following factors:
 

• Income: Your current income and future income capacity will give you a clear idea of how much you can set aside for saving in a life insurance plan.
  
  
• Expenditure:Your current expenditure can give an insight into how much you spend on different needs and how much financial backing your family will require to fulfil future living costs and life goals.
  
  
• Liabilities:Your life cover should be enough to enable your family to settle liabilities like debts and loans in your absence.
  
  
• Assets:Factoring your existing investments, property, savings, gold, and other tangible assets will help you decide how much extra financial support you need from your life insurance.

   

How to choose the apt insurance plan?
 

 

To choose the apt insurance plans, you have to follow the steps below:
 

• First, determine approximately how much cover you need.
• After that, analyze different plans online to find the one offering the advantages at premiums that suit your budget.
• Next, check your insurance company’s claim settlement ratio2 (CSR), or the number of claims the company settles every financial year (FY).
  
   

In conclusion
 

Your financial needs and obligations are bound to change with time. To get the support you deserve, do not hesitate to enhance your coverage with increasing insurance needs at different stages in life.

 

L&C/Advt/2023/Mar/0796