In recent times, insurance companies have been campaigning heavily on creating awareness among masses for the need of insurance policies. While many people are aware of the benefits that life insurance plans have, there are still many who avoid purchasing this policy. One of the reasons is due to the various myths surrounding the policy. Lack of information can be dangerous, especially, when it comes to providing financially security to your loved ones. If you are someone who is confused about such myths, read on to know more about the facts related to such myths.
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What is a life insurance policy?
A life insurance policy is a type of policy wherein the insurer agrees to compensate the policyholder’s family with the sum assured. This amount is given to the family in the event of the policyholder’s untimely demise. The sum assured amount is based on the plan that you purchase. The compensation amount would help your family remain financially stable and plan a secure future for themselves while remaining protected from life risks.
What are the myths related to this policy?
Life insurance plans have many myths surrounding which deters people from buying. Listed below are few such myths and the facts surrounding to them:
1. The policy is costly
People have this general idea that life insurance policy costs a lot. That, however, is dependent on the type of policy you are opting for, and when you buy it. If you purchase the policy at a younger age, the cost would be lower. On the other hand, purchasing the policy at a later stage could cost more. Also, there are different types of policies that have different benefits. A policy that might benefit one person does not have to necessarily benefit another person as well. It is always better to do some research and compare different policies before you decide. There are policies that are quite affordable for everyone. Always seek a professional opinion to get a better understanding.
2. I’m happy with my office insurance
While it is true that many offices offer a group insurance policy to their employees, relying solely on its cover could be risky. The caveat of such policies is that their cover is valid till you work at that organisation. If you join another organisation, the cover of the existing policy ceases to exist. If you were to leave your existing organisation, you and your loved ones would be without the coverage of a life insurance plan. If any emergency were to take place during this period, it would mean having to pay from your pocket. Thus, it is better to have personal insurance policy as well apart from your office insurance.
3. As I am single, I do not need insurance
Many young individuals who live alone do not believe in purchasing a policy for themselves. They are usually under the impression that since there are no dependents relying on their income, they do not need any insurance. However, if you are someone who is living alone, and have purchased a house or vehicle on loan, the responsibility of repayment could fall on the shoulders of your nearest kin in the event of your untimely demise. Not only would this cause financial turmoil for them, but it would also mean having to borrow money to clear these loans and debts. Therefore, you should invest in a life insurance cover. You could nominate a relative who could claim the sum assured and take care of your debts without facing any financial risks.
These are just a handful of myths related to life insurance. Based on these myths, it would be beneficial for you to invest in the policy to enjoy life insurance benefits. If you are planning on investing in the policy, you can use the life insurance premium calculator to get an idea about the cost of your policy.