- Assess if your life insurance cover has stayed abreast with your changing life stage and professional growth
- At any given point of time, you must ensure that your life insurance cover is substantial enough to help your family maintain the same standard of living, even in your absence.
- A pure term insurance plan is the appropriate type of life insurance and it offers substantial life insurance coverage at affordable premiums
A term insurance plan is a safety net that helps you secure your family’s financial future in your absence. While you might have bought a life insurance policy at some point in time, it should not be considered a one-time activity. This is because, the life insurance cover required is significantly influenced by the changing life stages and professional growth.
Here are 3 reasons you must re-assess your life insurance cover requirement and make necessary amends:
● Do You Have More Loved Ones To Care For?
Let us take an example of Mihir Mehra, a 35-year-old IT professional. He lives with his wife and a 5-year-old son in an upmarket area of Mumbai.
Eight years ago, when Mihir was a bachelor, he had availed a term insurance plan with a sum assured of ₹50 lakh. This calculation was based on his human life value back then. Now, after marriage Mihir must consider increasing his life insurance cover to safeguard his family’s interests in case of his absence.
● Do you have substantial unpaid loans and additional financial goals to achieve?
Over the last five years, Mihir has achieved several professional milestones. His annual income has gradually increased to around ₹20 lacs. His standard of living and expenses have also increased accordingly.
As his income increased, he could afford to buy his own house as well as a car. He has availed loans to acquire both these assets.
His current financial goals include planning for his child’s future. Owing to the rising inflation, he has estimated an amount of ₹80 lakhs for his son’s higher education. In addition to the education cost, he wants to save an approximate amount of ₹40 lakhs for his son’s wedding.
As seen below (in the table), Mihir’s current life insurance coverage is grossly inadequate. In an unfortunate event like his early demise, his family might not be able to meet these financial goals and repay the liabilities.
| Goals/Liabilities |
Amount (in ₹) |
| Housing Loan |
80,00,000 |
| Car Loan |
10,00,000 |
| Education Corpus |
80,00,000 |
| Wedding Corpus |
40,00,000 |
| Total |
,210,00,000 |
| Existing Life Insurance |
50,00,000 |
| Shortfall |
1,60,00,000 |
● Will Your Family Sustain Their Standard Of Living In Your Absence?
You work hard to ensure that you provide a better standard of living to your family. However, have you ever thought what will happen if your income stops when you are not around? Will your family be able to maintain the same standard of living even in your absence? In such a scenario, a substantial life insurance cover ensures that your family maintain the same standard of living that you would have wanted for them. A Term Life Insurance plan is an ideal instrument to achieve this objective.
Term life insurance plans offer various options to receive the payouts such as lump sum pay-out or monthly pay-outs for a fixed number of years, say 5 or 10 years till your dependents become financially independent. The monthly pay-outs help your family manage their day-to-day expenses, address liabilities, and achieve their other financial goals.
Here’s a look at the pay-out options offered by Exide Life Elite Term Insurance Plan- a unique term insurance plan that provides substantial life insurance coverage at affordable premiums.
| Payout Option |
How is the Payout made? |
Sum Assured ₹ 2 Crore |
| Option A: Lump Sum Payout |
100% Sum Assured is paid in a single payout |
₹ 2 Crore is paid as lump sum |
| Option B: Lump sum Plus Family Income Benefits(FIB) |
50% of sum assured is paid as lump sum and 0.95% of Sum Assured is paid every month for 60 months (5 years) |
₹ 1 Crore as Lump sum + ₹ 1.9 lakhs every month for 60 months (5 years) |
| Option C: Family income Benefit(FIB) |
1.07% of sum assured is paid every month for 120 months (10 years) |
₹ 2.14 lakhs every month for 120 months (10 years) |
The rising cost of necessities on one hand, and the uncertainties of modern life on the other, makes life insurance a necessity to safeguard the financial interests of your family.
