Life insurance policies serve different purposes at different stages of life. Young individuals purchase a life insurance policy to secure their family’s financial future against any eventualities. Similarly, a life insurance policy also serves the purpose of creating a secured retirement fund for the future of senior citizens. To ensure an individual’s financial security even after their retirement, there are different types of life insurance products available in the market, such as a whole life insurance plan, retirement plan, etc.
You may have invested in mutual funds and insurance to protect your finances. If everything goes according to plan, you must also have some money saved up after your retirement. There are various reasons why an aged senior citizen needs a life insurance plan. One main reason is that a life insurance policy works as an income replacement for the family. After retirement, the regular income of an individual stops. Moreover, in case of the demise of the senior member of the family, the financial burden falls upon their children. Meaning, to deal with any type of financial crisis, it is imperative to have a life insurance plan.
Here is why senior citizens must opt for a life insurance policy:
Health insurance and critical illness insurance:
Of course, health coverage at all times, during all walks of life, is essential. When you get sick, it assists you with your medical expenses. You are more prone to medical problems as you get older. If you get sick, a health insurance plan will protect your finances. You might also consider buying critical illness insurance as a supplement to your health insurance. The plan will offer extended coverage for illnesses not covered by health insurance. In the event that you become ill, it pays a lump sum. You may benefit from this in terms of your medical care. It can also assist your family in covering additional costs and fulfilling additional obligations.
Life insurance policy:
The time to purchase a life insurance policy is never too late. It enables you to look after your family in your absence. Here is why you should consider buying a life insurance plan:
If you have outstanding debts: A person takes many loans in his or her lifetime to meet both their long-term and short-term goals like buying a house or a car, education and marriage of children, etc. If you have any unpaid dues, you must consider life insurance meaning to shield your dependents from the burden of your unpaid debts in the event of your untimely demise. Senior citizens’ insurance policies pay out a death benefit in the event of your passing, which can be used to settle any of these outstanding debts.
You have dependents: If you have people dependent on you, consider getting a senior life insurance policy. You need insurance if your partner is a stay-at-home parent or if you have elderly parents to care for. Additionally, if you have young children who will depend on you for financial support until they are older and independent, you must consider purchasing a life insurance policy to secure their future.
To leave behind a legacy: Consider buying a senior life insurance policy if you want to leave behind a legacy for your family. The policy grants your nominees a death benefit in the event of your passing, which can assist them in covering their costs and pursuing their own life goals in addition to fulfilling their obligations. Additionally, this will be very helpful in establishing their life as they become more independent.
Ensure you analyse your short-term and long-term goals and the financial resources needed to meet them when shopping for insurance plans. Always consider a policy with high life insurance tax benefits. The best insurance policy won’t financially strain your retirement savings for seniors. Additionally, keep in mind that you will need to carefully read the terms and conditions for anything that could harm your planning.
In a nutshell, here are the Benefits of a Senior Citizen Life Insurance Policy:
Along with providing financial security to an individual, there are many other benefits offered by the life insurance policy for senior citizens. Let’s recap these benefits quickly:
- Take care of the future financial liabilities after retirement. So that one can live their retirement life stress-free.
- Create an emergency fund in the long term to deal with any emergencies after retirement
- Life insurance policy helps to take care of the medical expenses in old age
- Life Insurance Tax Benefits (Tax benefit is subject to change in tax laws).
- Life insurance policy reduces the financial burden
- Helps to fulfil the long-term financial objectives of life.
Note: The budget of the year 2020 saw the finance minister announce a new tax regime with lower tax rates and more tax slabs. Today, policyholders can choose either the old tax regime or the new tax regime to determine their tax liability, on the basis of the life insurance tax advantages that they want to avail.
Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms, and conditions, please read the sales brochure/policy wording carefully before concluding a sale.