5 reasons why you should buy life insurance at the right time and here’s how much you should invest

Life keeps throwing lemons at us and we should be prepared for all the eventualities. To prepare us for tough times financially, there are many products in the financial market and one of the oldest ones is the life insurance.

Many experts have always maintained the benefits of having a life insurance time and again as they protect you and your family financially.

“Life is unpredictable and one never knows when ill fortune may strike. Life insurance products provide financial security to the family and help them maintain their lifestyle and this benefit can be purchased at a very affordable cost,” said Rakesh Wadhwa, Chief Marketing Officer & EVP strategy & retail assurance, Future Generali India Life Insurance.

Life insurance products are highly effective risk and long term financial planning tool therefore, while there is no particular age to buy a life insurance policy it is advisable to start as early as possible.

“As a thumb rule, one should buy life insurance as soon as you start earning. It is strongly recommended that an adequate amount of life insurance coverage is determined before the actual purchase is made. A simple thumb rule is to have life cover approximately 10 times of the annual salary,” said Wadhwa.

The power of compounding works wonders over longer durations therefore, if one starts savings early, even with small amounts, one can build a sizeable corpus over a period of time and meet the financial goals comfortably.

Talking of premiums, they depend on age, type of product and the amount of cover chosen. “Still, 5-10 % of the annual income in a combination of products providing pure protection as well as savings or wealth creation should suffice for a start,” he said.

Now that you are aware of the right time and amount to invest in a life insurance, here are 5 reasons why you should start now