Your insurance needs depend on your age, financial goals and protection requirement. Read on to know more.
For all its wonderful moments, life can be uncertain too. We all take preemptive measures to deal with any kind of uncertainties. Insurance is one such offering that provides a great financial cushion to safeguard oneself or dependent family members during tough times. The insurance market, currently, offers a wide variety to choose from. Life, Health, Travel, Automobile and Home Insurance being the notable ones. However, choosing the right insurance plan as per your needs also gets tougher with the multiplicity of choices.
In this article, we provide an insight into the types of insurance you need.
Opt For Term Insurance In Your 20s
Pay early, pay less should be your motto in your 20s. The sooner you buy Term Insurance in your career, the cheaper premium is. Term Insurance, which is cheaper than other life insurance products, provides an assured amount to the nominee if the insured person dies during the policy period. As most term insurance plans expire once the policyholder attains 60 years of age, opting early will ensure insurance cover for a longer duration at affordable premium rates.
A Health Insurance Is A Must
Irrespective of what your age or financial earning is, a Health Insurance cover must be a part of your insurance portfolio. The rising healthcare and medical costs along with increased risk vulnerability owing to modern day lifestyle and stress mean that a health concern can deplete all your financial earnings in one go. Buying a Health Insurance plan early gives you ample time to stay financially protected from any pre-existing diseases after playing out the waiting period. A Health Insurance also offers tax benefits which can ensure optimum savings.
Link Insurance To Your Financial Needs And Goals
While Life and Health Insurance plans should be taken as early as possible for financial security, the type of insurance and cover should depend on your earnings, age, long-term financial goals and the number of dependants. Insurance premiums are cheaper at an early age than at a later age in life as the chances of age-related health issues are less. Prioritize essential insurance plans like Term Insurance and Health Insurance over an automobile insurance or a travel insurance plan, but do consider the latter if there is a need. Do not discount the riders of Life Insurance as an additional burden as they may offer enormous benefits. With an accidental death benefit rider, beneficiaries can get up to a maximum of twice the basic sum assured all for a nominal cost of the rider in the insurance plan.
Explore General Insurance Cover As Per Your Needs
When it comes to insurance life, health, travel and automobile insurance covers take centre stage, but there are various other insurance covers that can be equally effective for your needs. From insurance cover for misplaced keys for home or automobiles to cover for amateur sportsmen or even a second medical opinion, there are ample insurance plans that can be customized for your needs. It is best to do a little research about these general insurance plans before grabbing the best deal as per your risk and needs. For example, if you are an animal lover, you can opt for a pet insurance along with your Life Insurance plan.
Prioritise Protection Over Everything Else
When it comes to choosing insurance type, prioritise protection over the investment, returns or tax savings component. Term Insurance plans, for example, are not only more budget-friendly but also offer optimum protection compared to endowment cum investment plans. Opt for insurance as an investment only as an add-on once you have ample coverage and a protection plan in place as per your financial needs, your dependants and their future financial goals.
With so many insurance plans available, picking up the right plan can be a tough task. However, you should assess your needs, financial goals and protection requirement before opting for an insurance plan.
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