Why Corporate Professionals Might Need Life Insurance

Life insurance is a topic that often elicits mixed emotions among corporate professionals. While some individuals recognize its importance in protecting their loved ones, others harbour misconceptions that prevent them from considering this vital financial tool. In this blog, we aim to debunk some of the most common myths surrounding life insurance, allowing you to make informed decisions about your financial future. Let’s dive in and discover the truth behind these misconceptions.

Life Insurance Is Affordable

Life insurance is more affordable than commonly believed, with costs varying based on factors such as age, health, and coverage amount.

  1. Wide Range of Coverage Options: Life insurance policies come in various types and coverage amounts, allowing individuals to tailor their policies to their specific needs. In India, term life insurance is a popular and cost-effective option. For instance, a healthy 30-year-old non-smoker can secure a term life insurance policy with a coverage amount of 1 crore rupees for as low as 6,000 to 8,000 rupees annually. This means that for as little as 500 to 700 rupees per month, you can provide your loved ones with significant financial protection.
  2. Tax Benefits and Long-Term Savings: Life insurance policies in India come with attractive tax benefits under Section 80C and Section 10(10D) of the Income Tax Act, 1961. Premiums paid towards life insurance policies are eligible for tax deductions up to 1.5 lakhs rupees per year, and the maturity proceeds or death benefits are tax-free. This dual benefit of tax savings and financial protection makes life insurance a wise investment for individuals seeking long-term savings and wealth accumulation.

Even Young people might need life insurance

Obtaining life insurance early on is a wise financial decision, debunking the myth that young and healthy individuals don’t require it.

  1. Locking in Lower Premiums: One of the significant advantages of purchasing life insurance while young and healthy is the opportunity to lock in lower premiums. Insurance premiums are primarily based on age and health status. Younger individuals typically enjoy lower rates since they are statistically less likely to have severe health conditions. By obtaining life insurance early, you can secure a policy at a more affordable cost, ensuring long-term financial stability.
  2. Building Cash Value and Investment Opportunities: Certain types of life insurance, such as whole life or universal life policies, not only provide a death benefit but also allow you to accumulate cash value over time. This cash value can be utilized for various purposes, such as borrowing against the policy, supplementing retirement income, or funding educational expenses. By starting a policy early, you give yourself more time to grow the cash value component, providing you with additional financial flexibility in the future.

Life insurance provides a financial safety net for your loved ones, ensuring they are well taken care of if the unexpected occurs. By obtaining life insurance early on, you secure their future and provide them with the means to maintain their quality of life.

Life Insurance Premiums don’t keep increasing

One of the common myths is the belief that life insurance premiums will increase over time, much like health insurance premiums. Let’s explore the truth behind the notion of increasing life insurance premiums throughout the policy period.

  1. Level Premiums: A Key Feature of Life Insurance: Unlike health insurance premiums that often rise due to factors such as inflation, medical expenses, and healthcare system changes, life insurance premiums are primarily based on a level premium structure. This means that when you purchase a life insurance policy, the premium amount is typically locked in for the duration of the policy. This feature ensures predictability and allows you to budget effectively, knowing that your premiums will remain consistent over time.
  2. Term Life Insurance: Fixed Premiums for the Policy Duration: Term life insurance, a popular type of life insurance, provides coverage for a specific term, such as 10, 20, or 30 years. The premiums for term life insurance policies are generally fixed for the duration of the policy. This means that once you purchase a term life insurance policy, your premiums remain constant throughout the term. Even if you experience changes in health or other risk factors during the policy period, your premiums will not increase.

Life Insurance can be more suitable than term insurance

Term life insurance is suitable for providing coverage during high financial responsibilities but may not be the optimal choice for insuring until age 99, as it’s essential to consider long-term financial goals and explore alternative options.

  • Coverage Beyond Financial Responsibilities: Term life insurance is typically purchased to cover specific financial responsibilities, such as mortgage payments, educational expenses, or income replacement for dependents. These responsibilities often decrease or disappear altogether as you age. By opting for term life insurance until 99, you may end up paying for coverage you no longer need. Evaluating your long-term financial goals and coverage requirements can help you determine the appropriate duration of your life insurance policy.
  • Higher Premiums in the Long Run: Term life insurance premiums are generally more affordable compared to permanent life insurance options, such as whole life or universal life. However, the premiums for a term policy that extends until 99 years can become significantly higher as you age. Insurance companies factor in the increased likelihood of mortality as you grow older, resulting in increased premiums. This can put a strain on your budget, especially during retirement when you may have limited income sources. Opting for a shorter term or exploring permanent life insurance options can provide a more cost-effective solution in the long run.

LIfe Insurance can be better than the Return to Premium Option

The belief that the Return on Premium (ROP) option is the best type among different term insurance plans requires further evaluation to determine its validity.

  1. Higher Premiums: The ROP option often comes with significantly higher premiums compared to traditional term life insurance plans. The additional cost associated with the potential refund of premiums increases the overall expense of the policy. As a result, individuals opting for ROP plans may find themselves paying substantially more for their coverage, which may not align with their budget or financial goals. It’s crucial to consider whether the benefit of a premium refund outweighs the higher cost over the policy term.
  2. Limited Flexibility: The ROP option may restrict policyholders’ flexibility and financial planning options. As the policy term progresses, individuals may find their circumstances changing, such as reduced financial responsibilities or increased financial stability. In such cases, they may no longer require the same level of coverage or may wish to allocate funds to other investment opportunities. However, with an ROP plan, the premiums paid cannot be easily redirected or repurposed, as they are locked into the policy. This lack of flexibility can be a significant drawback for those seeking adaptable financial strategies.


By debunking these common myths surrounding life insurance, we hope to enable individuals to explore the benefits and importance of this crucial financial tool. Life insurance can provide financial security and peace of mind for you and your loved ones, allowing you to face the future with confidence. Remember to conduct thorough research, evaluate your specific needs, and consult with a reputable insurance professional who can guide you in making the best decision for your unique circumstances.