6 Myths about buying Life insurance policy

by Alexander Griffin
Life insurance policy

One of adulthood’s sticky situations is securing successful financial planning which includes being smart in your expenses today and also taking the necessary steps to secure your loved ones’ financial future. In trying times, it is important to think about how your financial liabilities will fare in tragic circumstances involving the bread earner of the family. One way to ensure they stay afloat is investing in a life insurance policy.

A life insurance policy insures a person with a contract that states a coverage amount will be paid out to their nominee or beneficiary in case of their death. Regular premium payments are necessary to ensure the same. Getting a life insurance policy, however, can be quite confusing when there are multiple myths constantly floating about. Here are 6 of the most common myths about buying a life insurance policy that you should pay no heed to:

  • It is only useful after the insured person’s death.

This is perhaps the most common life insurance myth out there. While it is true that life insurance policies have a death benefit, there are many other ways they are useful while the insured person is living. You can look into different types of plans like retirement plans and term insurance plans with critical illness riders for diseases like cancer, heart failure, etc. You can also avail a number of tax benefits.

  • Young people don’t need life insurance.

If there is one word that describes life, it’s “unpredictable”. No matter how young and healthy you are, health issues and traffic occurrences can sneak up on you anytime and you should always be prepared. A shock like that can affect your family’s financial situation but a life insurance policy ensures it doesn’t come to that.

  • Life insurance is unaffordable.

Life insurance, today, is extremely affordable. You can buy a number of different types of life insurance policies at small premium amounts. Additionally, you can customise these plans to best suit your needs at reasonable prices.

  • Payout will be denied.

A common worry for families is that when the time comes, payout will be denied to them by the insurance company for a variety of reasons. This worry can be put to ease by thoroughly researching your company’s claim settlement ratio, solvency ratio and industry reputation to ensure this doesn’t happen.

  • Only people with financial dependents need life insurance.

Even people with zero financial dependents have debts, mortgages and bills to pay out. A life insurance policy can take care of all of these without any trouble.

  • Life insurance coverage should be double your annual salary.

The coverage amount is very important and while double your salary seems like a fair deal, it usually won’t make the cut. You need to consider your current expenses, future needs along with factors like inflation to come up with the right coverage amount.

Clearing these myths makes it obvious that buying a life insurance policy is an extremely easy process. Take a look at the plans offered by ICICI and rest assured that you have invested at the right place.

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