Becoming a parent soon? It is undoubtedly one of the greatest joys of life. But with that joy comes greater responsibilities as well. You will have to plan to financially secure your child and family in the future, particularly when it comes to meeting his/her goals and needs. This is where life insurance matters a lot for new parents. Wondering how? Read on for more below.
Why is Life Insurance Crucial?
Your child will naturally depend on you financially in his/her initial years and even beyond, right from education and daily costs to healthcare and more. Your income will also play a big part in fulfilling these needs. However, in a scenario where you are not around due to any unforeseen tragedy, your family may grapple with the financial impact of the same if they are not covered in advance. Life insurance will give them this safety net that they can depend on while coping with the loss. What it does is give them adequate financial safety in your absence. Additional coverage options like accidental disability and critical illness riders can also be purchased to cope with various financial uncertainties in life.
When Should You Get Life Insurance?
The answer to this question is as soon as possible. It is no secret that life insurance premiums can increase significantly as you grow older. When you get life insurance early, your premiums are much lower, as age and health impact the premium rates. This allows you to invest the saved money in additional covers like essential riders.
Things to Remember When Getting Life Insurance
Life insurance can be more than just coverage offered on your death based on your choices. Here are some aspects worth noting while purchasing life insurance.
- Keep your needs in mind – The main goal of life insurance will be meeting the financial requirements of your loved ones in the future. You should choose proper coverage that will be sufficient in this case. Ensure that it is enough to pay debt, take care of higher education expenses, and also cover daily household costs. It is recommended to calculate coverage based on your liabilities, lifestyle costs, and inflation.
- Choose your policy type wisely – Multiple insurance plans are available today in the market. New parents may want to consider term insurance due to high coverage options at comparatively lower rates. Those looking for investment/savings components with life coverage may opt for whole-life insurance (with higher premiums), Unit Linked Insurance Plans (ULIPs), or child plans.
- Choose and compare insurance plans – Comparisons between multiple insurance plans are necessary above everything else. Check the products offered by each reputable insurer and their features and benefits before making an informed decision on what works for you. Factors such as premiums, sum assured, riders, policy term, and claim settlement ratio should also be considered.
Conclusion
As a new parent, you may feel overwhelmed by your responsibilities. However, financial security should be a top priority to ensure your family can live a safe life even when you are gone. So, do not hesitate and get life insurance as early as possible for maximum security of your family’s future.
