Is it mandatory to purchase both life or time period insurance coverage insurance policies?

I’m a 35-year-old working mom with two daughters. I haven’t purchased any life insurance coverage coverage however I do produce other investments. Is it mandatory to purchase life insurance coverage or time period insurance coverage at this stage since I don’t have any legal responsibility?

—Name withheld on request

Life insurance coverage is strongly really useful for working professionals of their mid-30s with dependents. Think about life insurance coverage as a option to exchange your earnings in your absence, in order that your childrens’ schooling and well-being is taken care of. 

While you could not have any excellent monetary liabilities as of at present, you’ll have future obligations by way of increased schooling of your youngsters, health-care, and different household commitments. You ought to consider in case your different investments are ample to deal with all these future obligations.

 Another facet to think about whereas evaluating the necessity for time period insurance coverage, is the liquidity of different investments. Sometimes people have a considerable portion of their wealth invested in actual property or fairness in non-public corporations. These belongings take longer to liquidate. In the absence of an lively earnings, dependents could face money circulate points. 

Term insurance coverage supplies a right away liquidity assist. If a person has substantial belongings however not liquid, they may purchase time period insurance coverage protection ample to cowl bills for the time taken to dispose the belongings.

I’m a 55-year-old particular person and can be retiring quickly. I’m seeking to purchase a time period coverage for 15 years. Is such a coverage obtainable? Should I purchase a time period coverage at this stage?

—Name withheld on request

Term insurance coverage is a method to supply monetary independence to your dependents in your absence. You can buy time period insurance coverage to cowl your lively income-generating age i.e., till retirement. 

The retirement age may be thought of whenever you cease working fully, together with part-time for cash. After retirement, you wouldn’t have an lively earnings, so there isn’t any earnings to exchange it. In reality, with out an lively earnings, you’ll be burdened with paying annual premiums out of your retirement corpus.

It is widespread for folks of their 50s, who’ve dependents, to purchase time period insurance coverage. So, a number of insurers supply time period insurance coverage on the age of 55. You would have a variety of choices to select from. 

Abhishek Bondia is principal officer and managing director, SecureNow.in.

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