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Should You Buy Term Insurance For Senior Citizens? Research Team | Posted On Saturday, January 05,2019, 05:46 PM

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Should You Buy Term Insurance For Senior Citizens?



What is Term Insurance?

 Term insurance is a kind of life insurance, valid over a fixed term. It is a term contract between insured and insurer, under which the insured pays premiums periodically to keep the policy active. The beneficiary/nominee would receive the insured amount, called death benefit, on demise of the policy holder within the term. There are no survival benefits in a normal Term Insurance Policy.

Term Insurance is extremely important if you are the breadwinner of your family. Term insurance will secure your family financially, when you are not around. A policy holder would spend a very small amount on premiums.

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SEE ALSO: Review Your Insurance Plans With IndianMoney

Should You Buy Term Insurance For Senior Citizens?

Why You Need Term Insurance Policy?

Modern lifestyle demands you be flexible with work timings, and therefore you are more prone to health related issues. The world is so uncertain that you never know what’s in store. Considering the risk involved in day to day life, it is only wise to avail a term insurance plan.

Term Insurance Plan will take care of all the liabilities like home loan, personal loan and so on. Term Insurance is highly recommended if your job involves working in hazardous environments, frequent travelling and so on, as the risk involved is high.

Advantages Of Term Insurance Plan

  • Term Insurance Policy financially secures family’s future if something untoward happens to you.
  • Your Home Loan will be taken care of and your family can continue to stay in the house.
  • Your children can continue pursuing their education.
  • You can lead a stress-free life as your family’s future is secured.
  • Premiums paid on Term Insurance are eligible for tax deductions.
  • Death Benefits are exempt from tax.
  • Availing different riders have their own benefits.

SEE ALSO: Term Life Insurance v/s Money Back Life Insurance

Should You Buy Term Insurance For Senior Citizens?

In India, citizens above the age of 60 years are called ‘Senior Citizens’. Having read the above mentioned benefits and the way in which Term Insurance works, the question arises ‘Should you buy term insurance for Senior Citizens’. Well, primarily Term Insurance is designed for those who have dependent family members. You can buy Term Insurance for Senior Citizens for the following reasons:

  • Your kids are still dependent on you: Due to late marriage or for any other reason, if your kids are still young and financially dependent on you, then you should consider availing a Term Insurance Policy.
  • Working Post Retirement: If you are working even after retirement due to financial commitments, then your family is in need of a Term Insurance Policy.
  • Have Unpaid Loans: If you have any financial liabilities, then it is extremely important to have a Term Insurance Policy as the proceeds received can be used to clear the outstanding loans.

SEE ALSO: Joint vs Individual Term Insurance: Which Is Better?

Keep a Check on High Premium Rates:

Generally, the Term Insurance premiums are high for Senior Citizens. This is because the insurers have to bear a higher risk on your health. Insurers consider that risk involved behind insuring Senior Citizens, to be high due to the age factor and weak immune system. You would have to undergo certain medical tests and scans before availing insurance, and this is done to ensure that your health condition is good.

Term Insurance Policy premiums for a 50 year old would cost almost twice the cost of a 20 year old. It is important to assess financial conditions and requirements, before opting for a Term Insurance Policy, as premiums increase drastically with increase in age. Table below gives the comparison of Term Insurance premiums under different insurers:

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