Being a single parent is tough. You work hard to feed your children, but you still need to be sure that you have left something for their future in case of an unexpected event. Term insurance can save your family from many troubles. This article will explore how vital term insurance is, especially for single parents.
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Term insurance provides life insurance coverage for a certain period, ranging from 10 to 30 years. If the insured dies within this term, the policy pays the sum assured to the beneficiaries. This simple feature makes term insurance even more beneficial for single-parent individuals who want to secure their children's financial future.
Here are several reasons why single parents, such as you, must consider term insurance plan as a core part of their financial planning:
Being a breadwinner, your income is usually seen as the only source of support for your kids. In your absence, term insurance will guarantee that your kids can maintain their way of life. The death benefit will enable them to cover daily expenses, housing, education, and other requirements.
Term insurance is much more affordable than whole life insurance. A term plan is a practical step for single parents working under a tight budget. Lower premiums mean you can secure significant coverage.
Single parents must pay for mortgages, loans, and credit card debts. After you are gone, those debts will weigh heavily upon your children. Term insurance would pay off the debts and free your family from that burden.
With term insurance, you are relaxed knowing that your children will be taken care of financially if something happens to you. This way, you can focus on your daily responsibilities to achieve your goals for a brighter future with your children.
Term insurance offers numerous flexibilities. You can pick a term plan that matches your family's needs, and if necessary, you can also increase or decrease the sum assured to meet your evolving needs.
Term insurance premiums paid are eligible for tax saving under Section 80C of the Income Tax Act. This allows you to save up to ₹1.5 lakh per financial year.
With a term plan in place, you have peace of mind knowing your family will be financially protected in an unforeseen circumstance. This security allows you to focus on wealth-building efforts, such as investing in other assets, planning for your children's education, and more.
The selection of the right term insurance policy would require proper consideration and research. Here are the steps that guide you through the process:
Depending on your income, debts, living costs, and other possible liabilities in the future, which may include education fees, determine how much you'll need.
Compare insurance service provider policies. Compare premiums, coverage amounts, terms, and additional benefits to determine the best value for your money.
Review as your situation changes-for instance, children grow up, or there is a change in your income. Go through your insurance needs and adjust your policy based on it. Then, you will be definite that your coverage is well-suited.
ACKO Life Flexi Term Plan is a modern, highly flexible, customer-centric solution that lets you customise your plan according to your needs. Competitive premiums ensure that you receive comprehensive financial protection without overspending.
ACKO's fully digital policy management system enables you to make any policy changes easily, including:
You can also add ACKO’s valuable riders, including the ACKO Life Accidental Death Benefit Rider, the ACKO Life Accidental Total Permanent Disability Benefit Rider, and the ACKO Life Critical Illness Benefit Rider.
The Critical Illness Rider covers 21 critical illnesses, including life-threatening common illnesses among women, such as breast, cervical, fallopian, and ovarian cancer.
To help you choose the appropriate term insurance coverage, here is a rule of thumb based on the income level:
For annual incomes within this bracket, you must look for 10 to 12 times your income. That is approximately ₹50,00,000 in term insurance coverage that protects your children with a very good safety net.
If your earnings are between ₹10,00,000 and ₹20,00,000, you should opt for coverage between 12 to 15 times the income.
The cover amount must be 15 to 20 times your income. You will require between ₹3,00,00,000 and ₹4,00,00,000 or more for comprehensive financial security for your children's education, lifestyle, and future requirements.
NOTE: You can use a term plan calculator to estimate the right coverage or consult a financial expert for personalised advice for informed decision-making.
Term insurance is significant for single parents. Their children are everything, and knowing they are financially secure gives them immense peace of mind. As a hardworking, dedicated, and loving single parent, stay informed, choose the best plan according to your needs, and secure your family's future
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Reviewed by Vaibhav Kumar Kaushik 
Acko Technology & Services Private Limited
#36/5, Hustlehub One East, Somasandrapalya, 27th Main Rd, Sector 2, HSR Layout, Bengaluru, Karnataka 560102
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