Monday, 28 December 2015

Five Common Insurance Myths

Insurance is only meant for the wage earner of the family: Every family member needs insurance. The need for insurance may differ from person to person but it is important to gauge and analyse this need. It is not just the chief wage-earner’s prerogative to insure himself.
Insurance is mainly for tax saving: Saving tax is just an added advantage of insurance. Governments offer Best Tax Saving Plan benefits on insurance plans so that more and more people feel encouraged to insure themselves. The main objective of insurance is to provide financial protection to you and your family and to build an assured corpus for your future needs.
Benefits of insurance can be reaped only after death: Insurance provides financial protection to you and your family. One of the main objectives of taking insurance is to provide financial support to your family in case you are not around, as in case of term insurance. But that is not the only objective. Insurance helps you to build a corpus for yourself and your dear ones. It provides you with comfortable retired life and even takes care of your needs at various life stages.
Group insurance provided by my employer is adequate: Your group insurance might be adequate but what if you change the job? Once you change the job your group insurance will cease and you will be left with no cover till your new employer gets you covered. So it is always advisable to take insurance other than the insurance offered by your employer. Also the insurance provided by your employer may not be adequate to provide complete financial protection to your family.
Young people do not need life insurance: We live with a common notion that people die when they are old. But knowing about life’s uncertainties, it is best to take insurance early in life. Having the risk of death covered is definitely better than leaving dependents financially unstable in case of an untimely death. Besides, it is useful to take benefit of the lower premium rates offered to the young. The older you grow; buying insurance becomes tougher due to higher premium rates or refusal because of ill-health.

Source: http://blog.hdfclife.com/did-you-know/insurance-myths

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