Arenla is a brilliant student and the only daughter of Temjen and Imkongla. For the past two years, she has been preparing for the medical entrance examination. In her first attempt, her NEET score was good. But after the re-examination, her rank slipped significantly, leaving her parents in a difficult situation. Arenla has decided to spend another year going through the gruelling process of preparation. If she still cannot secure a seat in a government medical college, her parents are considering a private medical college—an option that could involve a substantial financial commitment. Metsu is another young student with a very different challenge. She wants to pursue her master’s degree in Australia. Her parents are financially comfortable and can afford to sponsor her education abroad. But Metsu, fiercely independent, wants to take a student loan instead. She is confident that after completing her studies, she will find employment in Australia, Europe, or North America and repay the loan from her own income. Her father is proud of her confidence; her mother, understandably, is a little worried.
Both Arenla and Metsu are about to enter the world of student loans—a financial product that has become increasingly common for higher education, particularly professional and overseas degrees. And for students who take substantial loans, there is another piece of financial protection worth considering: term insurance.
Traditionally, we associate term insurance with working adults—with people who have a regular income, financial dependants, and significant liabilities. But that is changing. Term insurance is now also available to young adults and students. The reasoning is simple: a young person may not yet have an income, but they can already have financial liabilities. Some of these newer plans are designed for young adults between 18 and 25 years of age and can provide protection for 30 to 40 years. The biggest advantage of starting early is affordability. For an 18-year-old with no health issues, a term cover of Rs. 50 lakh can cost less than Rs. 400 a month in some plans. That works out to roughly Rs. 13 a day. Premiums can also be paid monthly, quarterly, half-yearly, or annually, depending on the policy.
But should every young person rush out and buy term insurance simply because it is cheap?
If you have no financial liability, you generally do not need life insurance. If you have not started earning, there is usually little reason to insure your life merely for the sake of having a policy. Once you begin earning, your financial priorities should first include building an emergency fund and securing adequate health insurance. Term insurance becomes important as your financial life progresses and your liabilities grow. You may take a home or education loan, begin supporting your parents or siblings, get married, have children, and gradually become responsible for the financial wellbeing of others. That is when life insurance becomes an essential part of your financial plan—not before. Arenla and Metsu, however, are unusual cases. Their financial liabilities have begun even before their earning lives have started. If either of them takes a substantial education loan, that liability does not disappear simply because something happens to the borrower. A suitable term insurance policy can therefore provide an important layer of protection for the family and help ensure that the burden of repayment does not fall entirely on the parents. This is why, for students taking large education loans, term insurance may not merely be an option. It can be a prudent safeguard against an unlikely but financially devastating event. As I have said in this column before, providing every possible detail is no longer the primary purpose of this column. Almost every detail is available at our fingertips today. The job is to handpick an idea that deserves your attention—and point you towards a financial question worth exploring more deeply.
Dipankar Jakharia
Friday, September 4, 2026