Avert These Errors While Buying Life Insurance- MoneyMindz

By | 14/07/2018
Avert These Errors While Buying Life Insurance- MoneyMindz

India’s First Free Online/On-call Financial Advisory Portal – MoneyMindz – Life Insurance

You know the importance of purchasing a term insurance plan. However, some people are bound to commit certain mistakes related to life insurance. Here are some mistakes that you should not commit.

Not many people in India are aware of things like insurance and investment while some of those who are aware of those are often unaware of its procedures. As a result, they usually end up making mistakes.

  1. Forever young

You know such people. This breed always claims to be forever young and walks around faking their age to be as youngest as they can fake it. We might believe them, some of us might not. But life knows the reality and time will apply to them also. You never know when you might get affected by a catastrophe. Nobody in the Titanic or people who lived before the disaster occurred knew that most of the Titanic passengers, all eight musicians and most of the crew were going to die in large numbers on that fateful night of 14th April 1912, for instance. When in trouble, life insurance can be the savior to you and your loved ones, especially your dependants.

  1. “Insurance is an investment!”

You have probably seen that meme of a laughing person laughing his heart out. Well, that is the reaction of people aware that insurance is not an investment when they listen to some misguided souls who think insurance is an investment. Insurance is meant to cover your life, your loved one’s life and your property. Investment is saving money for the future (for different purposes) by gaining lots of interest. Insurance is NOT an investment.

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  1. Leaving the policy at the wrong time

Policyholders sometimes have many reasons to justify that they have to (want to) exit anytime before the maturity. This is like saying you will leave the party even before you socialize with people and enjoy. An early exit is a bad idea especially in insurance and investment plans. Once bought, the policies should be continued till maturity to get the cost benefits.

  1. Too many policies

Too many cooks spoil the broth is a popular saying that means too much is too bad. Anything in excess is bad. Each life insurance policy has many cost-heads that include agency commission.

  1. The cheaper, the better

A common misconception among consumers is that the commodity is better if cheap. Great things need not always be cheap. Having said that, great things need not always be costly too. You have to research yourself and see which one suits you better.

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  1. Not informing near and dear ones that you have bought insurance

This is one of the biggest and costliest mistakes one makes usually. Blame ego and ignorance for preventing the disclosure of the insurance being purchased. Be it insurance or investment, your family has to be informed. Otherwise, in the event of a catastrophe, your loved ones will never know about the insurance and investment you bought.

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