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Supriya Menon, 28, recently got her first job. She has started investing and has also bought a health insurance policy to take care of any medical emergency. She, however, is not able to decide whether she should buy a term insurance policy. Being young she doesn’t have any liability and dependants. In such a scenario does it make sense for Supriya to take a term insurance plan, which gives a lump sum amount to the family if the insured dies.  Though life insurance is an integral part of financial planning here are a few examples of people who can consider skipping term insurance:

Retirees

When the earning member of a family dies early the whole family suffers a setback. Hence, buying a life insurance policy is important as it takes care of the financial well-being of the family when you are not around. But what if the person is near retirement or has already retired and hence there are no financial needs of the family to be taken care of. In such a case it makes sense to skip life insurance as your children have become independent and you already have already paid off loans during your working life.

No dependents

A young person like Supriya, might not have a need to buy life insurance when they are young with no dependents. This is the time when people don’t have liabilities like home and car loans. Hence young people who have just started venturing out can skip life insurance. But the decision needs to be revisited once Supriya gets married and has kids. Also, one needs to remember that as you grow old, the premium rates increase, hence buying at the later stage could make the policy costly.

Comfortable net worth

You also need to consider your net worth before deciding the need for life insurance. If you are already having sufficient net worth where you can easily meet your liabilities such as loans and children’s education then you don’t need life insurance. Life insurance is for those who have the risk of leaving their family behind with financial liabilities.

Hence, if you belong to any of the groups mentioned above then you can consider reviewing your decision to buy a life insurance plan.