Insurance Needs for Young Professionals

The article is written by Mr. Gaurav Rajput CMD Aviva India, If you want to contribute guest post on this blog, check out the guidelines and join our information sharing program.

For young professionals working in corporate India today, there is no dearth of options available to spend hard earned money and investing in an insurance policy might be considered as an expensive and an often unnecessary proposition. I’m pretty confident that people between the age group of 20-30 would have received at least one call from an insurance company but as the urgency to spend on an insurance policy is fairly low, these calls are often ignored. Insurance investment at an early age is a good habit. Not only does it provide financial security and stability at a young age, but also the intangible benefits like peace of mind and a sense of having provided for your loved ones at a time when they will need it the most.

Why is insurance necessary for young professionals ?

At a young age, most professionals are financially independent. Most of them manage their own investments and also handle their expenditure like paying of loans, credit card dues, etc. Of late we have seen a major shift in the lifestyle of young professionals with more working hours, higher stress levels and an alarming rise of related lifestyle diseases like diabetes, obesity and cholesterol. In such a scenario, insuring oneself becomes as essential as other expenses.

More over many of these young professionals financially support their families. Life insurance as well as health insurance is absolutely critical so that in case of any unfortunate event like an accident or a sudden demise, the family doesn’t go through a financial trauma as well. Even if the person is not contributing in the family financially, insurance cover proves to be useful in case of an unfortunate demise.

There are various options available for the young professionals like -

• Retirement
• Health
• Protection Plan (Term Plan)

The first step is to decide what type of insurance one needs to invest in. This depends on each individual based on their future needs. Starting early is the key, the earlier you begin investing, larger the corpus would be on maturity. Term Insurance is gaining popularity these days due to the protection benefit it offers to the family of the person insured. More over term insurance are cheap for an instance for Rs 8000/- (odd) one can get a Sum Assure of Rs 1 Crore.

Other reasons why young professionals should get insured early

In many cases young professionals don’t buy insurance policies thinking they are adequately insured by their companies/employers under a group life and health plan. The key thing to remember is that the group cover may not be sufficient in your case or aligned to your income. Secondly, when one is young and healthy, you are a better risk; hence, insurance companies can offer you a life cover at lower rates.

Investing early in insurance will not only help you save tax but also will also instill a habit of saving and financial discipline ensuring that you are secured in the long run. So if you are a young professional reading this article, it’s high time that you think about investing in insurance if you haven’t yet thought about it.