Ideal Age to Purchase Life Insurance and Determining Coverage Amount

2024-10-27

1888 Views

10 minutes read

Locate branch

Resume journey

Pay Premium

Live Life More Confidently

Get best insurance from our experts

Name is required Name should be Valid

Mobile Number is required Mobile Number should be Valid

Email is required Email should be Valid

DOB is required DOB should be Valid

Annual Income*

< 3 3-5 5-7 7-10 > 10

Annual Income is required

I agree that even if my contact number is registered with NDNC / NCPR, I would still want the Company to contact me on the given number and email id for the clarifications/product information sought by me and agree that I have read and understood the Privacy Policy and agree to abide by the same.

Please tick to proceed further.

Thank you for your interest in our product. Our financial expert will connect with you shortly to help you choose the best plan.

Term insurance is one of the primary financial needs. The moment you start earning and taking up some of the financial responsibilities in the family, you should start thinking of a life insurance plan. To understand the ideal age of buying a life insurance policy, you need to understand the situations where life insurance will be most useful.

Key Takeaways

The best age for life insurance is as early as possible—ideally in your 20s.
Delaying insurance increases premiums and reduces eligibility.
Term insurance offers affordable, flexible protection tailored to your life stage.
Always reassess your coverage during major life events.
Canara HSBC Life Insurance iSelect+ Term Plan provides add-ons like child support and income payout for maximum protection.

Consider the following two cases:

Sudheer is 23 years old and is the oldest in the family. He has just started earning and bears the responsibility of his 2 younger siblings, who are completing their education.
Himani is 29 years old, is single, earning and has no particular responsibilities at home. Her parents are financially independent, and siblings are all well settled in life.

Between the two cases, who do you think needs life insurance more? While the answer is obvious, you also need to look at the trade-offs.

Disadvantages of buying life insurance too late

Ideally, you should get your life and health insurance plans as soon as you start earning. Waiting often leads to the following disadvantages:

Premium cost increases with age
Contingencies always have a cost and someone in your family will bear it, so insurance helps them at least recover those costs
Any health condition you develop before getting the insurance may not be covered by the policy

Thus, getting insurance as soon as possible with your income is the best choice for everyone.

Did You Know?

Buying term insurance in your 20s can slash premiums by up to 60%, saving lakhs! Start with iSelect Smart360 Plan by Canara HSBC Life Insurance.

Source: CanaraHSBC

How much life insurance is enough?

This is an important question to consider while buying life cover. You should understand that life insurance is a need and it comes before any investments. In fact, while planning for contingencies, the family must buy insurance first even before starting to save for emergency fund pool.

Thus, insurance takes precedence over any kind of investment. Also, insurance is meant for the financial protection of your family and you. So, what you are looking for is an insurance which will help your family sustain their lifestyle and meet their financial goals, and so on.

When it comes to life insurance it has to do so in the event of your untimely demise. But all of this must happen within the limits of your income. Founding Principles of Insurance does not allow the protection cover to profit from the insurance payout.

Thus, if your income is Rs. 10 lakhs a year, maximum life cover you can secure would be limited to 10 to 15 times this amount, which is sufficient for the family to maintain their lifestyle for a long time and meet their future goals.

Therefore, in the case of Sudheer, if his take-home income is Rs. 5 lakhs per annum, he can secure a life cover of up to Rs. 75 lakhs. However, this does not mean that he cannot increase the cover later.

Increasing the Term Cover - Why & When?

Under normal circumstances, everyone experiences growth in the family and financial responsibilities. Thus, the life insurance cover should also grow to keep up with your growing responsibilities, income and lifestyle.

So, when do you need to increase your life insurance cover?

Significant events to buy life insurance

How to get the ideal life insurance cover in India?

With the growing number of life insurance companies offering competitive solutions for life insurance plans, it’s easier than ever. All, you need to do is visit the website and select the online life insurance plans to see which one suits your needs.

Ideally, it would be the term insurance plan if you are buying purely for financial protection or buying life insurance for the first time. With online term insurance, you can input your information including your annual income and the calculator gives you the ideal life cover for you.

Check the benefits and select the additional covers available with the term plan, if you do not already have. For example, accidental death and disability cover is the most common addon cover with a term insurance plan.

Begin securing your future

Full Name* Please enter correct name Please enter the Full name

Mobile Number* Please enter valid mobile number Please enter Mobile Number

Email* Please enter valid email Please enter Email

...Read more Consent is required

Step by Step Process:

Here’s a step by step process for selecting and securing the best life insurance cover for your family:

Check your total cover amount which should be at least 10 times of your annual income
Select additional benefits like – accidental death and disability cover
Select the benefit amounts for additional covers
With i-Select+ term plan from Canara HSBC Life, you can also select a child support benefit. This cover provides an additional amount for your child’s goals such as education and marriage.

Select pay-out mode or the way you would like the insurer to pay the benefit amount to your family.

Remember your family will need a regular income to run the household and lump sum money to invest for future financial goals. With the i-Select+ plan, you can divide your total benefit amount to be paid as a lump sum and regular income.

Select a growing regular income so that the inflation is accounted for with the benefit payout
You can select the policy and premium terms next.
Ideally term cover should last at least till your retirement. So, if you are 30 years of age now, you should select a 30-year policy term. You can keep the premium payment term either same as policy term or go for a lower period. This may increase your regular premiums to some extent.
Check your premium and select the best mode of payment. If you are salaried go for monthly mode.
Pay the premium and complete the application form.

Once you have completed the application form, you may have to appear for a medical checkup at the nearest assigned centre. Once done, the insurer will consider your proposal and issue the life insurance policy.

Modified Proposal

Insurers often modify the cover depending on various factors. You should not worry if the insurer has modified your proposal or asking for extra premium for the same cover. The insurer will do that if there is anything which causes them to assign a higher risk to your life.

This would mean two things – one, the risk on your life is higher than the normal, and two, you need the life cover even more now. Accepting the modified proposal only ensures a smooth claim settlement experience for your family.

So, do not worry and avail the best life insurance cover for a safe financial future.

How Does Age Affect Term Plan Eligibility & Benefits?

Age is the determining factor of your coverage and benefits under a term policy. You are considered low-risk in your youth, and this finds expression in much lower premium rates and easier approval. You are able to secure a high sum assured for an extended policy term without having to go through rigorous medical tests. As you age, not only do premiums increase, but also the length and sum of the coverage provided by the insurer are reduced. Age-related health issues can lead to increased premiums or exclusions for your policy. Hence, purchasing life insurance at an early stage ensures that you receive maximum benefits at minimal expense.

Younger Age = Maximum Leverage, Minimum Cost

Purchasing a term insurance policy in your 20s or early 30s is not only intelligent—it's strategic. You're usually at the prime of your health at this age, and that puts you in a commanding position in a number of ways:

Gain access to higher sum assured options aligned with your income potential
Enjoy exceptionally low premium rates that remain stable throughout the policy term
Enjoy more freedom in policy tailoring, from payout choices to riders
Choose longer coverage terms, protecting your family well into your retirement years
Ultimately, the sooner you take action, the more solid your financial defence mechanism is—with much less outflow.

Older Age = Higher Costs, Limited Coverage

Waiting until you're in your 40s or 50s to buy life insurance can make a big difference in your eligibility and affordability:

Premiums rise sharply, approximating increased risk perception by insurer.
You're likely to incur extensive medical underwriting or pre-existing condition exclusions.
Policy term choices can be narrowed down, providing limited coverage up to retirement.
A higher amount assured could be disapproved, particularly if health risks are indicated.
Postponing life insurance usually costs you lower benefits that are paid at a higher price. Understanding the optimal age for life insurance gives you the power to make a financially disciplined and family-oriented choice.

Life Insurance - Top Selling Plans

We bring you a collection of popular Canara HSBC life insurance plans. Forget the dusty brochures and endless offline visits! Dive into the features of our top-selling online insurance plans and buy the one that meets your goals and requirements. You and your wallet will be thankful in the future as we brighten up your financial future with these plans.

Family Shield: Enhanced Protection

iSelect Smart360 Term Plan

3 Plan options
Life cover till 99 years
Steady income benefit
Block your premium at inception

Start Young, Pay Less, Stay Secured

Young Term Plan

Life cover till 99 years
Coverage for spouse
Block your premium rate
Covers 40 critical illness

Fixed Returns, Zero Risks & Worries

iSelect Guaranteed Future Plus

4 Plan options
Life cover + Guaranteed benefits
Accidental death benefit
Premium protection cover

Life Insurance vs. Term Insurance – What to Choose Based on Your Age?

When choosing between term insurance and life insurance, your age is the determining factor. Although both have the fundamental function of financial protection, their structure, benefits, and appropriateness change with life phases. A 25-year-old with no dependents might not require the same coverage plan as a 45-year-old with increasing family obligations.

Term insurance generally turns out to be best in the initial years because it is cheaper and comes with a higher sum assured, while whole-life or endowment plans could be suitable for individuals considering wealth generation along with protection in later years. Knowing your present requirements and future objectives is important to make the correct selection.

Age Group	Recommended Plan	Why It Works
20s–30s	Term Insurance	Low premiums, high coverage, ideal for starting a family
30s–40s	Term + Investment-Based Plans	Ideal for balancing wealth creation with protection
40s–50s	Whole Life or Endowment	Suitable for estate planning and retirement needs

Conclusion

Life insurance is not just a financial product, it’s a promise of security to your loved ones. While the best age for life insurance is as early as possible, the type and amount of coverage must evolve with your responsibilities and income. Whether you’re just starting out or entering a more financially demanding phase of life, term insurance offers a smart, cost-effective foundation for long-term protection.

With features such as iSelect Smart360 Term Plan by Canara HSBC Life Insurance, you can customise your insurance, select adjustable payouts, and upgrade your security with add-on benefits such as child support and critical illness benefits. Don't let life's unpredictability overtake you by surprise. Choose to act today and build a future that's as certain as your devotion towards your family.

Glossary

Term Insurance: A pure cover for life that provides monetary security for a specific duration at reasonable premiums.
Sum Assured: The assured sum your nominee gets in the event of your untimely death during the policy term.
Policy Term: The period for which the insurance cover is active.
Premium: The premium you pay to maintain your life insurance active.
Add-On Cover: Additional benefits (such as accidental cover) that can be added to your standard policy at an extra cost.

Disclaimer - This article is issued in the general public interest and meant for general information purposes only. The views expressed in this blog are solely those of the writer and do not necessarily reflect the official policy or position of Canara HSBC Life Insurance Company Limited or any affiliated entity. We make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability, or availability with respect to the blog or the information, products, services, or related graphics contained in the blog for any purpose. Any reliance you place on such information is therefore strictly at your own risk. You should consult with a qualified professional regarding your specific circumstances before taking any action based on the content provided herein.