When you are an earning member of the family, you have a different take on your finances. You want to create a financial plan that secures your loved ones in your absence. With a plethora of life insurance policies, it’s difficult to narrow your choices. However, one type of life insurance that is particularly popular amongst all age groups is term insurance.
Term insurance offers life coverage for a fixed tenure. The policyholder decides the number of years they want coverage while buying a term plan. The reason behind their popularity is that they offer sufficient coverage with affordable premiums. Their premiums are usually lower than other types of life insurance.
Why buy term insurance for long term?
When you are buying life insurance, the tenure you choose matters significantly. Selecting a plan with insufficient tenure may lead to you buying life insurance again after a few years. This would be expensive since, as you age, the cost of your term plan is likely to increase. Hence, you must buy a term plan for the long haul. Here are five reasons to buy long-term insurance:
Secures your family’s future for the long haul
When you are a contributing member of the family, you have to plan for your dependents as well. You must take their needs and goals into consideration. For example, if you have a child, you need to consider the financial needs of your child’s education. When you buy a term plan for the long haul, you will be relieved that in your absence, the dreams and needs of your loved ones will not be compromised. The longer that you can secure their life, the better it will be. A long-term term insurance plan ensures that in your absence, your loved ones do not face any financial turmoil.
Lucrative option for young individuals
Age is a major factor that is taken into consideration while determining the premium of your term insurance. When you are young, it is easy to get an enormous sum of coverage for an affordable premium. Buying term insurance for the long haul makes sense when you are young since you can easily lock a huge coverage for an affordable premium. Buying the same term plan again after a few years would rather be expensive. You can use a term insurance calculator to get an estimate of the premium you need to pay for your desired sum assured and tenure.
Simple and easy to understand
Term insurance is a type of pure life insurance with no savings or investment components attached to it. It is easy to understand and works simply. When you are choosing the tenure, you can easily go for long-term term insurance since you get a life cover for a longer period with no complications. You are relieved that during the entire duration, your loved ones have a financial cover to rely on in your absence. Also, term insurance provides huge coverage at affordable premiums compared to other types of life insurance.
Provides coverage against your debt
There may be some liabilities and debt that you may take over the years, like a home loan. The payback of these liabilities takes a long time. In case of your sudden demise, the burden of repaying your debt would be on your family. Having term insurance for the long haul with sufficient coverage ensures that in your absence, your life cover will suffice for any liabilities that you have to pay. It ensures that, when you are no longer around, your family is not troubled by any outstanding liabilities. You can also use a term insurance calculator to ensure that your coverage is sufficient for your family’s needs and liabilities.
Allows you to focus on your goals without any worry
When you are working towards your goals and dreams, you constantly think about ensuring the security of your family. When you have long-term term insurance, you do not have to worry about the financial needs of your family in your absence. With sufficient cover, you can live peacefully and be rest assured that your family is secure. When you have a term plan in place, you can also focus on your other financial needs. You can set investments that align with your goals.