Hey Tushar,

It is very good that you are thinking responsibly about protecting your family's future. The questions you asked are the dilemma anyone at your age faces.

I do not have a recommendation, I will rather leave you with a framework to think about life insurance for self.

1. Sum Assured is life insurance is calculated based on current and future earning potential, but largely current income weighs higher. Your income is yet to grow as you gain work ex. Better to cover yourself when you have clarity on income growth.

2. In my case, no one in my family is dependent on my income. I am almost 10 yrs older than you. For whom will my life cover make sense? Waiting to see how much financially your spouse would be dependent on you would be the key thing. In case your parents would be dependent on you financially, then makes sense to consider life cover.

3. I honestly believe we're oversold the idea of high premium. Without adequate data to make decision, every planning on life cover would fall short of the target. It's best to make such investment decisions when you have more visibility into your liabilities.

4. What if you decide to go for higher education? Keep that in your roadmap.

5. Save your income aggressively if you don't have expenses right now.

Anuj Jindal

Co-founder

SureClaim

Hello Tushar,

Here are the answers to your questions.

1) You should buy term insurance only when you have financial dependents. If you have dependents, then you must buy a policy immediately.

2) You should buy a cover that is the difference between what you owe and what you own. What you owe includes a) a corpus for your dependents to live the same lifestyle they are living today + healthcare expenses - in absence of you. b) Any large expense that you foresee today for your financial dependents to be taken care of. c) Any loans you have taken today.

3) You must go for increasing cover - it is the most efficient way to systematically increase your cover as you grow old and your financial responsibilities increase. Understand the cover, its capping well before you opt for it.

4) Review your cover again at every life event (marriage, children, promotions, buying home etc.) in the same calculation explained above. This is explained really well with examples in our eBook.

4) In our opinion, most of the riders can be better substituted by specialized covers - like standalone critical illness policies, and accident policies. Waiver of premium riders can still be opted for.

5) Buying early - saving premium works - but we would still recommend you buy an insurance only when you have visibility of financial dependents in your life.

All this and more is explained in detail in our comprehensive eBook available here: https://www.beshak.org/term-insurance/e-book/buy-guide - Do check it out.

Hope this helped :)

Team Beshak.