As a young adult, life insurance may not always be at the top of your to-do list. After all, at this stage of life, you might feel like you’re invincible and that life insurance is something you can think about later. However, securing a life insurance plan while you’re still young can offer numerous benefits, including lower premiums, peace of mind, and the financial protection of your loved ones in case of an unfortunate event.
PolicyBazaar is India’s leading online insurance aggregator, offering a wide range of life insurance policies from top insurers in the market. In this blog, we’ll explore the best life insurance plans for young adults, and how you can use PolicyBazaar to compare and choose the right policy that fits your financial goals.
Why Should Young Adults Consider Life Insurance?
Before diving into the comparison of life insurance plans, it’s important to understand why young adults should invest in life insurance in the first place.
- Lower Premiums: Premiums for life insurance are typically lower when you’re young and healthy. By purchasing life insurance early, you lock in these affordable rates for the duration of the policy.
- Financial Protection for Loved Ones: If you have dependents, such as a spouse or children, life insurance can provide them with financial security in case something happens to you.
- Building Financial Security: Life insurance can serve as a foundation for building your financial portfolio. Some life insurance policies, like endowment plans or unit-linked insurance plans (ULIPs), offer both insurance and investment benefits.
- Tax Benefits: Life insurance premiums qualify for tax deductions under Section 80C of the Income Tax Act, which can reduce your taxable income.
Top Life Insurance Plans for Young Adults on PolicyBazaar
Choosing the right life insurance policy is a critical decision. Let’s take a look at some of the best life insurance plans that young adults can consider. With PolicyBazaar, you can easily compare multiple policies, their features, and their premiums to make an informed decision.
1. Term Life Insurance
Best For: Affordable coverage for a fixed period.
Term insurance is one of the most popular and cost-effective options for young adults. It provides a high sum assured at a relatively low premium, making it ideal for individuals who want to ensure their loved ones are financially protected without breaking the bank.
- Key Benefits:
- Lower premiums due to the absence of a savings component.
- Flexibility to choose the term (e.g., 10, 20, or 30 years).
- Option to add riders for additional coverage (e.g., critical illness rider, accidental death benefit).
- Top Plans on PolicyBazaar:
- HDFC Life Click 2 Protect 3D Plus: Offers comprehensive protection with 6 plan options, including critical illness and accidental death benefit.
- SBI Life eShield: Affordable premiums, tax benefits, and the option to increase coverage over time.
2. Unit Linked Insurance Plans (ULIPs)
Best For: Combining insurance and investment.
ULIPs are ideal for young adults looking to build long-term wealth while getting life insurance coverage. These plans allow you to invest in different funds (equity, debt, hybrid) based on your risk appetite. A part of the premium goes towards the insurance component, while the rest is invested in market-linked securities.
- Key Benefits:
- Dual benefit: Life cover along with the opportunity to grow your wealth through investments.
- Flexibility to choose investment funds according to your risk tolerance.
- Tax savings under Section 80C and Section 10(10D).
- Top Plans on PolicyBazaar:
- ICICI Prudential LifeTime Classic: A ULIP plan offering both life cover and an opportunity to invest in a variety of funds.
- Max Life Smart Wealth Plan: Provides a mix of insurance protection and investment options in multiple fund types.
3. Endowment Plans
Best For: Individuals seeking insurance with savings.
Endowment plans offer the dual benefit of life insurance and saving for the future. A portion of the premium goes towards the life cover, while the other portion is invested to create a corpus for the future. These plans are suitable for young adults who are looking for financial protection along with disciplined savings for their goals.
- Key Benefits:
- Risk cover along with guaranteed returns on maturity.
- Bonus facility adds to the value of the policy.
- Ideal for short to medium-term financial goals.
- Top Plans on PolicyBazaar:
- Bajaj Allianz Life Goal Assure: A flexible endowment plan that lets you accumulate savings while securing your loved ones.
- HDFC Life Sampoorn Nivesh: Offers both risk cover and an opportunity to accumulate savings with bonuses.
4. Critical Illness Insurance
Best For: Financial protection in case of major illnesses.
Critical illness insurance provides a lump-sum payout in case you’re diagnosed with a critical illness, such as cancer, heart disease, or kidney failure. While not typically bundled with life insurance, this policy can be added as a rider to your existing life insurance plan for comprehensive coverage.
- Key Benefits:
- Financial support during challenging times when you might not be able to work due to illness.
- One-time payout for specific critical illnesses.
- Can be added as a rider to your life insurance policy.
- Top Plans on PolicyBazaar:
- Religare Care Critical Illness Plan: Covers a wide range of critical illnesses with a lump sum payout.
- Star Health Critical Illness Insurance: Offers coverage for various critical diseases, with customizable benefit options.
5. Money-Back Policies
Best For: Those looking for periodic payouts.
Money-back policies are designed to provide regular payouts (usually every 5 years) during the policy term. The premium paid is returned to the policyholder at regular intervals. This type of policy works well for young adults who want both insurance coverage and periodic returns on their investment.
- Key Benefits:
- Periodic payouts help meet financial goals.
- Provides a lump sum amount in case of death during the policy term.
- Tax benefits under Section 80C.
- Top Plans on PolicyBazaar:
- LIC Money Back Plan: Offers periodic payouts and bonuses, along with a comprehensive life cover.
- Bajaj Allianz Life Monthly Income Plan: Provides regular income along with financial protection.
How to Compare Life Insurance Plans on PolicyBazaar
Comparing life insurance plans is made easy with PolicyBazaar. Here’s a step-by-step guide on how to use the platform:
1. Enter Your Details
Start by entering basic details such as age, gender, and the amount of coverage you need. This will help PolicyBazaar recommend the most suitable plans for you.
2. Compare Plans
Once you enter your details, you will be shown a variety of plans from different insurers. You can compare them based on features such as premium amount, sum assured, policy term, and riders available.
3. Read Customer Reviews
PolicyBazaar has customer reviews and ratings for each plan, which can help you understand the experiences of others who have purchased the plan.
4. Choose the Best Plan
Based on the comparison, choose the plan that suits your financial goals, coverage needs, and budget.
5. Purchase the Plan
Once you’ve selected the right plan, you can purchase it directly through PolicyBazaar with a few clicks. The platform also offers seamless payment options.
Frequently Asked Questions (FAQs)
1. Why should young adults buy life insurance?
Buying life insurance at a young age helps lock in lower premiums, offers tax benefits, and provides financial protection for your loved ones in case of an unfortunate event.
2. What is the best type of life insurance for a young adult?
The best type of life insurance for a young adult depends on your needs. Term insurance offers affordable coverage, while ULIPs and endowment plans are good choices if you’re looking for a combination of insurance and investment.
3. Can I add riders to my life insurance policy on PolicyBazaar?
Yes, you can add various riders such as critical illness or accidental death benefit to your life insurance policy purchased through PolicyBazaar to enhance coverage.
4. How do I compare life insurance plans on PolicyBazaar?
You can compare life insurance plans on PolicyBazaar by entering your details and exploring different options. The platform will show plans from various insurers, allowing you to compare premiums, coverage, and additional benefits.
5. Is life insurance a good investment for young adults?
Yes, life insurance can be a good investment for young adults as it provides long-term financial security, tax benefits, and an affordable way to build wealth, especially if you opt for ULIPs or endowment plans.
6. How much life insurance coverage should I get as a young adult?
The amount of coverage you need depends on factors such as your income, liabilities, and dependents. A general rule of thumb is to have a coverage amount that is 10-15 times your annual income.
Conclusion
Buying life insurance at a young age is a smart financial decision that offers both protection and the opportunity to save on taxes. With PolicyBazaar, comparing life insurance plans has never been easier. By understanding your needs and choosing the right policy, you can ensure that you’re securing your future