Never let insurance myths deter your financial goals. In this article some of the common misunderstandings about life insurance are busted. The goal of the life insurance is to compensate the monetary loses that may occur due to life insured’s death. By purchasing one can be pretty sure that life insured’s dependents are not put to financial sufferings in case of death of life insured. However there are many myths associated with life insurance.
Myth No.1 – Term insurance is waste of money as you don’t get returns if I survive
Term insurance is the cheapest form of insurance. This is more of a contingency planning financial scheme, which compensates monetary losses on the event of death of life insured. Term insurance guard’s your dependents from financial insecurity, your liabilities. As we all know that life is uncertain in today’s world. It is more of a safety mechanism that is applied to one’s financial planning.
Myth No.2 – Young people don’t need life insurance
We all know life is uncertain. The common mindset of people is people die at old age, this may be true in majority of the cases but buying life insurance at early age has its own benefit. Earlier you buy lesser premium you pay for the insurance cover. At higher age you have to not only shell out more for the premium, but also there is a chance of your insurance getting rejected due to ill health.
Myth No.3 – Medical Insurance & Life insurance provided by the employer is sufficient
The above covers are available only when you are in service with that company. The insurance cover provided by the company may not be adequate for your dependents, which may not cover living expenses. It is advisable to buy medical when one is young and healthy. This enable one to be covered for all the illness that may arise after insurance is taken. If medical insurance is taken with preexisting illness, one may have to wait for period specified by insurer to get preexisting illness covered under that medical insurance scheme. In some cases the insurance may be rejected.