Did you know... that a term insurance plan that protects the financial future of your loved ones is cheaper than your evening tea and snack!
Term insurance: It is the purest form of Life insurance but still it has not gained popularity among the masses. Many still refuse to buy it, due to lack of understanding about the overall benefits it offers and all thanks to a few myths. In this article we've punctured 5 popular myths.
1. “I am not gonna die so early, I will myself do everything for my family."
People think buying a Term Insurance Plan is a complete waste of money. But, what happens if any sudden calamity happens, and you are no more for your family? Have you thought about your parents or spouse or children who are dependent on you?
The burden of debt taken for completing your education would haunt them. The hope of a second income that makes your parents relax would just disappear. What about the liabilities that you might have created in the form of Car Loan, Home Loan, Personal Loan, Credit Card Payments, Business Loans etc?
Isn’t it time you gifted your parents, spouse and children a complete peace of mind even in your absence by buying a term insurance plan?
2. “Term insurance is a complete waste of money, as I will not get anything back.”
In today’s life insurance Market, each and every insurer is offering Term Insurance Plans to meet customer’s protection needs. For many of us, term insurance premium/day would cost less than a high tea.
If you are still thinking about not getting anything back if you survive the term of the plan here’s another way to make some money.
You can start a monthly SIP into a mutual fund plan for a small amount say Rs. 500/- per month for the entire duration of your chosen term insurance plan.
The money that you will earn from this investment would be far more than the total premiums you have paid for your term insurance plan.Add to it the tax exemptions you get for the invested amount and this sounds like a real deal. Now that’s a smart way of protecting your family, making money and saving taxes!
3. “Confusion about how much life cover one needs”
The primary purpose of a Term Insurance Plan is to substitute the loss of income arising from your death. If you buy a cover equal to only your present income, from the next year onwards, you will be forcing your loved ones to downgrade their standard of living. They will be forced by you to bring down their lifestyle.
It is best to buy a life cover equal to your Human Life Value (HLV). HLV is an estimate of the financial value of your life. The cover you choose should be adequate to replace your current and future income so that your family can continue to have the same lifestyle and cover any outstanding loans that you may have taken.
4.“Insurers always reject term insurance claims for some or the other reason.”
Insurance contracts are based on the principle of utmost good faith. You should fill the application form correctly without any errors, pay your premiums on time, this will minimize the chances of Insurer rejecting your claim. If a claim is denied by the insurance company, there is no need to worry. All one has to do is file an appeal with the IRDAI. IRDAI is the government body ruling the insurance industry in India. It keeps a close watch on the claims registered and ensures smooth reimbursement if found rightful. Many beneficiaries have already been compensated by the term insurance during unforeseen events.
5. “I cannot customize a term insurance plan as per my needs.”
Today’s term plans offer you a plenty of choices to meet your every need. You can customize them as per your needs:
Coverage Options: You cover yourself for a fixed lumpsum amount. You get Term Insurance Plans that offer benefits like Accidental Death & Disability, Terminal Illness, Critical Illness, Total and Permanent Disability, Waiver of Premium, etc.
Death Benefit Pay-out Options: You can choose the manner in which your life cover (death benefit) would be paid to your nominees i.e. you can go for Lumpsum Pay-outs, Lumpsum + Annual Income, Monthly Income, Increasing Monthly / Annual Income, etc.
Policy Term: You choose a policy term that best suits your needs, it can be as small as 5 years or as long as upto 99 years of your age.
Premium Payment Term: You get a choice on duration for which you wish to pay the premiums it can be either Single, Limited or even regular pay. You can also select the mode i.e. Annual, Half-yearly, Quarterly or Monthly.
Comprehensive Coverage: Along with the base cover, you can opt for additional coverage for accident, disability and disease with riders. With so many choices you can create a comprehensive protection that takes care of all your needs.
6. "I am covered by Employer's Term Cover for Free."
It may not be adequate.
You have no control over the terms and conditions.
It is only valid till you are Employed.
So, what are you waiting for, get yourself protected right now! Term insurance ensures your loved ones maintain a dignified life style even in your absence.Remember, it is not for you,it is for your family. So,look beyond just what is in it for you. Make the right choice by opting for the right plan here at Pinnacle Wealth. Contact : +91 9689675010 or Email: pinnaclewealthindia@gmail.com
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