For adults and especially those with families to tend to, life is flush with many responsibilities and aspirations that requires meticulous financial planning, eventually building a corpus that could be tapped into at different stages in life. However, in addition to saving regularly and investing wisely, it is important to ensure that these goals can be fulfilled even in your absence. To achieve this, life insurers in India have developed a range of insurance products that not only offer financial protection against the vagaries of life, but also can double up as a savings and retirement planning tool that can supplement other investments. Let us delve into the need for life insurance solutions and learn how they provide a robust financial safety net in times of need.
Why is life insurance so important?
In a country where 65 per cent of the population is under the age of 35, it is apparent that most families are dependent on young working members to take care of their everyday needs. This trend is expected to peak by 2041, by which time the working-age population will contribute to nearly 60 per cent of the total Indian population. What’s more, increasing urbanisation has led to the rise of nuclear families, where the traditional benefits of a joint family are absent. In such a scenario, it is vital that young adults and parents alike not only plan for their children’s future but are also prepared to take care of their parents in their old age. This implies a very heavy reliance on such individuals to safeguard their family’s needs, thereby necessitating that they purchase an adequate life insurance cover that could cover future expenses even in their absence. Moreover, with most life insurers offering insurance products that also secure against health risks like critical illnesses, individuals can enhance the extent of financial protection secured by purchasing two or more life insurance policies for better peace of mind.
Different types of life insurance products and the coverage they offer
While a term insurance is the most basic form of life insurance that one can opt for, there are a number of life insurance plans that combine the benefits of a term insurance with additional risk mitigation features that are attuned for varied individual requirements. For example, Savings plans, Child plans and Retirement plans are very useful for adults who would like to enjoy the protection of a term insurance plan along with the opportunity to receive a lump sum amount on policy maturity, which can be used to meet specific goals like funding a child’s education, building a home or for generating a retirement corpus. Health plans are ideal for individuals who would like to supplement their existing health insurance policy and secure their family against unforeseen medical expenditures resulting from heart disease, cancer or any other critical illnesses. Additionally, for those who want to take advantage of market-linked investment products along with the security of life insurance, Unit Linked plans are ideal from a long-term wealth creation perspective.
Building a safety net against life’s uncertainties
It is recommended that individuals assess their financial responsibilities and purchase one or more life insurance policies to safeguard their families against any future exigency. Opting for an adequate sum insured amount and complementing a term policy with additional risk covers will only serve to enhance the protection provided in case of permanent accidental disability or premature death due to health or other risks. Considering the number of life insurance plans available today and the coverage they offer, it is advisable to discuss with family members and purchase the most appropriate plan after consulting with a certified financial advisor. Ultimately, the objective is to enjoy the finer moments in life without worrying about life’s uncertainties, something that is possible with the protection of life insurance.
