A type of life insurance policy that provides you coverage for a specific period is called a term plan. The term plan provides your beneficiaries with the maturity amount upon your unfortunate demise. An attractive reason to get a term plan is that you get an excellent coverage amount at a reasonable premium. For an e.g., if you are someone who has invested in a term plan for 1 crore, your premium could be as low as Rs. 485 per month. The term plans also come with a flexibility that allows you to pay these premiums either at once or at fixed intervals, which are mutually agreed upon, by you and the insurance service provider. 

Why is buying a term plan at an early age beneficial?

1. Premium amounts for term insurance are low. If you start early, you will get the cover at a cheaper rate than starting at an older age. For an e.g., if you are covered till the age of 75 years for a coverage amount of Rs. 1 crore, the premium that you will pay is around Rs. 6000 at the age of 25 years and Rs. 10,000 at age 30, Rs. 30,000 or more at 45 years of age. As you are younger, your responsibilities are less and hence, these premiums are lower. 
2. The premiums for term plans remain locked in throughout the policy life. So if you start out early, in most cases the total premium for the whole policy paid by you will be much lesser than the total premium you will be paying for investment in a term plan at an older age. 
3. Your family and your dependants will get a handsome cover early on. In extremely rare cases, if you meet an unexpected death, your dependents will have something to suffice their needs. If you have any debt that is undertaken by you, in such cases your family will have to bear it after your demise. In situations like these, a term plan’s maturity amount will assist you. 
4. Multiple tax benefits will help you save tax. One of them is a tax deduction under section 80C of the Income Tax Act, 1961 that will allow you to claim a deduction up to Rs. 150,000. Another tax benefit is under section 10(10D) wherein the maturity amount will be completely exempted from tax. In addition, section 80D of the Income Tax act, allows you to claim deductions up to Rs. 25000 for the payment of premium towards health-related coverages like critical illness riders.

Term plan is a product that you may need to purchase eventually in your life. A product has a plethora of benefits and is curated towards making your financial health sound and relaxed. If a term plan is bought at an earlier stage in life, it will also provide you with the benefits like lower premiums, less total premium, tax benefits, financial security to your dependants with a substantial sum and much more. Term plan is something that you should not miss out on.