Millennials today are far more financially aware than previous generations, yet many still hesitate when it comes to buying life term insurance. For some, it feels too early. For others, it seems unnecessary or confusing. However, as responsibilities grow and life becomes more unpredictable, having a strong financial safety net becomes essential.
A 1 crore term insurance plan offers an affordable and practical way to build long-term financial protection. It provides a high level of cover at a cost that fits most young earners’ budgets. Despite this, several myths continue to discourage millennials from choosing this smart financial tool. Let’s break them down in simple terms.
Myth 1: “I am too young to need term insurance”
This is one of the most common assumptions. Many young adults believe that life term insurance is something to think about in their thirties or forties. In reality, term insurance is cheapest when you are young. Premiums are calculated based on age and health, so a healthy 25-year-old pays significantly less than a 35-year-old for the same 1 crore term insurance plan.
Buying early also protects you before lifestyle-related health conditions appear. You lock in lower premiums today, saving significantly over the long term.
Myth 2: “A 1 crore cover is too much for someone my age”
A figure like ₹1 crore may seem excessive when you are early in your career. But when you consider long-term responsibilities, the number becomes surprisingly reasonable. Think about:
- home loans
- car EMIs
- household expenses
- parents’ healthcare
- children’s education
- inflation over the next 20 to 30 years
These costs can easily run into crores. A 1 crore term insurance plan ensures that your family can maintain stability if something happens to you. It is not about leaving behind wealth, but about covering future needs responsibly.
Myth 3: “Term insurance does not give returns”
Many millennials hesitate because life term insurance does not offer returns like investment products. However, this is actually what makes term insurance so affordable. It is designed entirely for protection.
If you want returns or wealth creation, you can invest separately in mutual funds, ULIPs or other financial instruments. A balanced strategy is simple: use term insurance to protect your income, and use investments to grow your wealth.
Myth 4: “Buying a policy and making claims is complicated”
This belief is outdated. The insurance industry has evolved dramatically with digital processes. Today, buying a 1 crore term insurance plan is quick and convenient. Most insurers offer:
- Online premium quotes
- Minimal paperwork
- Digital KYC
- Fast policy issuance
- Transparent claim processes
Myth 5: “There are no tax benefits”
This is incorrect. A 1 crore term insurance plan offers tax advantages.
- Under Section 80C: Premiums paid for term insurance are eligible for deduction up to ₹1.5 lakh per year.
- Under Section 10(10D): The death benefit received by a nominee is generally tax-free, subject to policy conditions.
Example
Rahul, aged 29, pays ₹15,000 per year for his life term insurance. Since this amount falls under Section 80C, it reduces his taxable income. If he earns ₹9 lakh per year, he saves around ₹4,500 in tax. Over ten years, this amounts to approximately ₹45,000 saved, along with financial security worth ₹1 crore for his family.
Myth 6: “I can buy insurance later when I earn more”
Many millennials assume they can buy insurance when their income increases. However, waiting only increases the premium. A plan costing ₹700 per month at age 25 could easily cost over ₹1,200 at age 35.
As you grow older, you may also face:
- higher premium rates
- additional medical tests
- exclusions for pre-existing conditions
The best time to buy life term insurance is when you are young and healthy. At this stage, having support from a transparent insurer becomes important. Trusted insurance providers like Aviva India help young adults understand how a 1 crore term insurance plan fits into their evolving responsibilities. With suitability-led product suggestions such as the Aviva Signature 3D Term Plan – Platinum, along with clear communication and easy digital processes, Aviva ensures that millennials can make informed choices early. This guidance helps them lock in affordable long-term premiums while choosing coverage that aligns with their financial goals.
Myth 7: “My employer’s insurance is enough”
Employer-provided insurance can be helpful, but it is not sufficient for long-term needs. Corporate covers usually end when you:
- Switch jobs
- Become self-employed
- Take a career break
Most employers' covers range from only ₹3 lakh to ₹10 lakh, which is far from enough for long-term goals. A personal 1 crore term insurance plan remains with you throughout your career and life changes.
Myth 8: “Term insurance is not useful if I am single”
Even if you do not have dependents right now, life term insurance still holds value. It can help:
- Support your parents
- Clear your loans
- Protect co-signed liabilities
- Manage business responsibilities
Buying early also locks in cheaper premiums for decades, so when your responsibilities grow later, your policy is already secure and affordable.
The Takeaway: A 1 Crore Term Plan Builds Stability and Confidence
Financial planning is not only about growing wealth. It is also about protecting what you are building. Millennials today face rising living costs, unpredictable job markets and increasing healthcare expenses. A 1 crore term insurance plan provides a solid foundation of financial security without straining your budget.
Choosing the right insurer and the right cover helps you stay prepared for life’s uncertainties. By understanding your needs early and taking action now, you give yourself and your family long-term confidence and peace of mind.
