Topic 4: Busting Myths about Term Insurance
Buying a pure term insurance plan is the most cost-effective way of getting one’s life insured. However, it has endless advantages but still, when it comes to buying a term insurance plan, people always give it a second thought. This is due to many myths that surround term insurance plans. Here, we have busted some common myths about term plans, so that the insurance seekers can find the simplest and the most economical solution for getting life cover.
1. An insurance plan without any return is not worth it
Well, if you are one of those people who think that an insurance plan without a return is not worth it, you seriously need to think again. A term insurance plan provides highest life coverage at a nominal cost. However, life insurance policy does not provide any return of premium paid, but on the contrary to this, it has a huge benefit.
2. All term insurance policies are similar, insurers don’t give claims
The major use of insurance policy is at the time of biggest family crisis. Have you ever thought that what if the insurer turns down the policy at the time of claim? This is where the reliability and transparency of the insurer come into picture. In case of any eventuality, a term insurance plan provides a lump sum amount to the beneficiary of the policy so that the future of your dependents can be secured.
3. Buying term insurance too early and too late in life is not beneficial
It is never too early or too late to buy a term insurance plan. Moreover, it is very beneficial if you buy the policy early in your life as you can buy it at the cheapest rate and can avail maximum benefits over the time. But one doesn’t need to worry even when he/she is older; the premium rates of term insurance plan are most affordable as compared to the other insurance plan.
4. My company provides Group Life Insurance
If you have a group insurance offered by your company then it’s really great but it is important to check the amount. You can also take advice of the financial advisors who will help you to know that how much insurance coverage you should have based on the current income. Many companies provide coverage, but most of the time it is not enough to provide you full coverage.
5. The cover of a term insurance plan cannot be increased
This is one of the major myths about the term insurance plan. Well, it’s not true. In case a person opts for a plan based on the income at the age of 25 then he/she can increase the amount once they reach the age of 30 or 40 and make it big. However, this will definitely cost you more but you don’t need to buy a separate term plan.
Source: policybazaar.com
1. An insurance plan without any return is not worth it
Well, if you are one of those people who think that an insurance plan without a return is not worth it, you seriously need to think again. A term insurance plan provides highest life coverage at a nominal cost. However, life insurance policy does not provide any return of premium paid, but on the contrary to this, it has a huge benefit.
2. All term insurance policies are similar, insurers don’t give claims
The major use of insurance policy is at the time of biggest family crisis. Have you ever thought that what if the insurer turns down the policy at the time of claim? This is where the reliability and transparency of the insurer come into picture. In case of any eventuality, a term insurance plan provides a lump sum amount to the beneficiary of the policy so that the future of your dependents can be secured.
3. Buying term insurance too early and too late in life is not beneficial
It is never too early or too late to buy a term insurance plan. Moreover, it is very beneficial if you buy the policy early in your life as you can buy it at the cheapest rate and can avail maximum benefits over the time. But one doesn’t need to worry even when he/she is older; the premium rates of term insurance plan are most affordable as compared to the other insurance plan.
4. My company provides Group Life Insurance
If you have a group insurance offered by your company then it’s really great but it is important to check the amount. You can also take advice of the financial advisors who will help you to know that how much insurance coverage you should have based on the current income. Many companies provide coverage, but most of the time it is not enough to provide you full coverage.
5. The cover of a term insurance plan cannot be increased
This is one of the major myths about the term insurance plan. Well, it’s not true. In case a person opts for a plan based on the income at the age of 25 then he/she can increase the amount once they reach the age of 30 or 40 and make it big. However, this will definitely cost you more but you don’t need to buy a separate term plan.
Source: policybazaar.com