8 Life Insurance Myths That Need to be Debunked/ Busted

Life insurance secures the certainties of life – a regular income source, a comfortable lifestyle, and the fulfilment of the dreams and goals of your loved ones. However, despite the many benefits of a life insurance policy, many potential buyers do not buy life insurance because of the myths revolving around it. Debunking these myths is crucial to making an unbiased and informed decision about whether you need life insurance or not.

8 Life Insurance Myths Debunked

Here are 8 life insurance myths debunked.

• Life insurance is expensive and a waste.
  

  A life insurance policy only charges for what it is worth to the buyer, so it is never a waste. Moreover, the cost of life insurance depends on the type of life insurance policy and the number of features chosen. For instance, basic term life insurance costs less but offers a high death benefit. On the other hand, endowment insurance or whole life insurance costs more but offers multiple advantages at once.

• A life insurance policy only covers death.
  

  Only term life insurance covers the eventuality of death and provides a death benefit to the family members of the policyholder. However, depending on the type of life insurance policy, you can get many other benefits and coverages in the same insurance policy. Life insurance, like whole life insurance or endowment insurance, for instance, provides the triple benefits of savings, insurance, and wealth creation, among other additional protection.

• The life insurance policy provided by an employer is enough.
  

  While this might be true, a life insurance policy provided by an employer only lasts till you are an employee at their workplace. Therefore, most employer-offered life insurance plans expire as soon as you leave the company. Moreover, the coverage they offer is seldom enough to cover your growing needs.

• Insurance companies deny life insurance claims all the time.
  

  Life insurance companies only deny life insurance claims for a valid reason. So, for instance, if you stop paying your premiums and your life insurance policy expires, the insurer will not let you claim the benefits under it. Or if you lied, misrepresented, or hid a fact or an important detail from the insurer and they find it out later, your life insurance policy can get denied.

• It is risky to buy a life insurance policy online.
  

  Whether you buy a life insurance policy online or offline, all that matters is how trustworthy the insurer is. Once you know that the brand name of the insurer and their claim settlement ratio is high, you can go on to purchase insurance from them irrespective of the mode. In fact, most insurers have shifted their services online and offer incentives and discounts to buyers for online purchases.

• Homemakers do not need life insurance.
  

  While life insurance policies get marketed to the sole or co-income earners of a family to secure their loved ones in their absence, it is also for those spouses who are homemakers. Covering them is an insurable risk. We often believe that homemakers do not add any financial value to the house, but in their absence, cooking, cleaning, childcare, and running the household, in general, will require qualified help, which in turn requires finances.

• Older people cannot buy life insurance.
  

  There is a myth that life insurance is only valuable when you are young and senior citizens cannot buy it. However, apart from term life insurance, there are many other best life insurance policies older citizens can benefit from, like retirement insurance, whole life insurance, annuity plans, etc. Senior citizens might have to pay extra premiums, but the benefits provided in exchange are worth it.

• You have all the time in the world to buy life insurance.

You might be young, healthy, and disease-free, so you might think you don't need life insurance. But life insurance is a product that you cannot buy when you exactly need it; you have to buy it well before the time of need arises. Therefore, it is best to be proactive about buying life insurance and getting it as early as possible. In fact, getting a life insurance policy when you are young is very affordable. 

To Conclude

Once you know the facts countering the myths floating around life insurance, it will be much easier to pick a life insurance policy suited to your requirements.

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