National Insurance Awareness Day 2024: Why is affordable and personalised life insurance vital for financial planning?

Imagine life as a grand jigsaw puzzle. Every piece, whether it's career, family, health, or leisure, fits together to create a beautiful picture of financial freedom. Yet, there’s often one piece that people overlook, the elusive piece that completes the puzzle: life insurance. Not just any life insurance, but personalised and affordable life insurance. It's the secret ingredient that ensures your financial masterpiece remains intact, no matter what life throws your way.

The quest for the right fit: Life insurance isn’t a one-size-fits-all solution. Just as you wouldn’t wear a suit off the rack for your wedding day, you shouldn’t settle for a generic insurance policy. Each individual has unique needs and circumstances, and that’s where personalised life insurance comes into play. Whether you’re a young professional just starting out, a parent planning for your children’s future, or nearing retirement, there’s a tailored policy designed just for you.

Consider the young, ambitious go-getter. For them, a term insurance policy might be the perfect fit. It’s straightforward and affordable, offering substantial coverage at a low cost. The term insurance policies can provide coverage 15-20 times the annual income for a premium that's often less than the cost of a daily cup of coffee! This policy acts like a safety net for an individual, ensuring that if life takes an unexpected turn, their financial responsibilities are taken care of without burdening their loved ones.

Building wealth with a safety net: Now, let's talk about the savvy savers and investors among us. You’re the type who’s always looking for ways to grow your wealth while securing your future. Enter the world of ULIPs. These hybrid policies offer the dual benefit of investment and insurance. Part of your premium goes towards life cover, while the other part is invested in equity, debt, or a mix of both. It’s like having your cake and eating it too – you get to build your wealth while staying protected.

For those with a more conservative approach, traditional savings plans offer a safer bet. These policies guarantee returns over time, acting like a disciplined savings tool. With interest rates often exceeding those of fixed deposits, these plans ensure you have a nest egg for significant life events like your child’s education or that dream retirement villa by the beach.

A golden retirement awaits: Speaking of retirement, wouldn’t it be nice to have a steady income stream in your golden years without worrying about market fluctuations? That’s where annuities come into play. These policies provide regular payouts, ensuring you have a reliable income post-retirement.

Annuities come in various forms – immediate or deferred, fixed or variable – allowing you to choose how and when you want to receive your payouts. It’s the financial equivalent of choosing your retirement playlist – personalised to your tastes and needs.

The affordable advantage: Now, let’s address the elephant in the room: affordability. Many people shy away from life insurance, assuming it’s a luxury they can’t afford. But here’s the good news – life insurance, when chosen wisely, is incredibly affordable. By assessing your needs and comparing different policies, you can find one that fits snugly within your budget.

Think of it as a strategic investment. The premiums you pay today are like seeds sown for a secure financial future. It’s about balancing your present needs with future security, ensuring that your family’s lifestyle is maintained, even in your absence.

The personal touch: Personalised life insurance isn’t just about choosing the right type of policy; it’s also about understanding the nuances of your life and goals. Insurance providers today are leveraging technology and data analytics to offer bespoke solutions. From adjusting coverage based on life stages to offering rider benefits like critical illness cover, the modern insurance landscape is all about customization.

Imagine having a policy that grows with you, adapting to your changing needs – increasing cover when you start a family, or offering premium holidays during financial crunches. It’s like having a financial advisor who knows you inside out and is always looking out for your best interests.

So, whether you’re at the dawn of your career, building a family, or enjoying the fruits of your labour, remember that life insurance is your steadfast companion. It’s time to stop viewing it as an option and start seeing it as the missing piece of your financial freedom puzzle. Because when life is unpredictable, your insurance shouldn’t be!

Alok Rungta, MD & CEO of Future Generali India Life Insurance Company Ltd