Pandemic has led to a very special rather weird situation in the country where people are fearing the contraction of the deadly virus. Since it has started creating an environment of fear, more and more people are taking life insurances and term insurances seriously. Interestingly, pandemic fear is not the only reason for people buying term insurance.
The growing mortality rate and unpredictable turns of life with respect to health, increasing lifestyle diseases due to sedentary lifestyle also constitutes the increased sale of term insurance policies. Due to this, many insurance companies have increased their premiums across tenures.
You might think that increasing premiums for a fixed life cover might have led them to drop the idea of buying term insurance. Well, that is not the case. In fact, the graph is still moving upwards. In this article, we will give you a few reasons that will convince you to buy term insurance despite the increase in premiums.
Reasons to Buy Term Insurance despite Increasing Rates
Term insurance policies are pure protection covers that help you take care of your family’s financial security and needs way before time. All you have to do is choose the right cover and pay a small premium every year towards it. There are various reasons for increasing term insurance which you should take into consideration as the premiums are affected due to increasing critical problems.
We will discuss each one in detail to help you understand why they are important.
Increasing mortality rate
The year 2020 has not been the best year for India. We have seen a spike in death rate not only due to the pandemic situation but also due to floods, earthquakes and storms in different parts of the country. Due to this, death claims have increased over the last few months.
The premiums are directly proportional to the mortality rates and expected future claims. There is an expected number of claims that any insurance companies decide based on the present scenario and then a premium amount is decided. In case, the gap is increasing between the expected and actual claims, premiums rise in order to bridge the gap.
Rising demand for term insurance
There are many term insurance plans in the market and the demand for them is increasing due to the rising awareness among people. You can buy term insurance online and various websites help you compare term insurance plans. The fear of death due to the increasing pandemic situation has also led people to realize the importance of term insurance plans in India.
Another reason for the surge in demand for protection plans is a low term insurance premium and flexibility in opting the death benefits. Also, the rising demand for term insurance is not a time-being thing but it might keep increasing over time.
Should You Buy A Term Insurance Now?
Yes. That is a short version of the answer to your question if you should buy term insurance. But, if you think increasing term insurance premiums might reduce the demands, you are wrong.
Term insurance is becoming an essential investment for everyone especially if you are in your early adulthood. However, the spike in premium should not hold you back from investing in term insurance plans.
You can do a few things before buying a term insurance. For example, check the background of the insurance company. Look at their history and reviews online. Many websites on the internet can help you recognize a term policy that best suits your requirements.
Know your requirements before buying one and read all policy document twice if needed before you sign them. Make sure you see the claim settlement ratio of the company. The more, the better.
We hope you got your answer and know that rising premium rates shouldn’t bother as the main aim is to safeguard your family from financial hardships in your absence. If you buy the right term insurance at the right time, the benefit would be as good as low premium still. So, what you waiting for, get term insurance for you and your family, now.