Top Life Insurance Myths to Get Rid Off
Most people look at insurance as something that helps them reduce taxes and save for future. Unfortunately, these are secondary benefits of insurance and not the primary reason why it should be bought.
Insurance is bought to provide financial security to dependents in case of death of the policyholder. It should be large enough to provide income replacement of the policyholder and help clear off all outstanding debts. But when it comes to insurance, there are many more myths that people believe in. Lets see the reality behind some of these myths.
A very big myth doing rounds is that life insurance is costly. The main reason behind this belief is that people think of survival benefit plans (like endowment, money-back, etc.), when they want to buy insurance. These are of course costly as these are products with dual benefit of insurance and savings. But one can easily buy insurance policies with large enough covers at very low prices, if one goes for plain term plans. A plan with insurance cover of Rs 50 lac just costs about Rs 6,000 a year! So it’s not that costly after all.
Now the young and single believe that they don’t need any life insurance cover as the product is mainly marketed for its importance for those with families. But it must be noted that at young age, insurance policies are more economical since premiums are low for low-age groups. Premiums tend to grow higher later in life as the life expectancy risks increase with age. More importantly, this cover can be extended to the family when one starts it in future.
Working professionals are also plagued by a myth that the insurance provided by their employer is enough for them. Unfortunately, if the job is discontinued or the person retires, they will lose their insurance covers. And since premiums are very high at later stage of life, it can be very costly to buy sufficient coverage later on.
These are some of the myths that people have and that cause a lot of harm to people’s financial lives. So sooner these are busted and necessary actions taken, better it is.
The ICC Men's Cricket World Cup 2023 is not just a sporting event; it's a cultural phenomenon, especially in cricket-crazy countries like India. The tournament, set to begin on October 5, 2023, promises intense cricket action and, interestingly, financial opportunities. One stock that stands out as a potential beneficiary of the cricketing frenzy is Zomato Limited (NSE: ZOMT).
- Oct 04, 2023
Nifty started the day with a gap down opening and corrected along with the broader market sell-off in Wednesday’s session. However, we witnessed a recovery in Nifty from the low of 19333 and it ended well above 19400 with a loss of less than half a percent.
- Oct 04, 2023
About Dolly Khanna and Rajiv Khanna Dolly Khanna, a well-known name in the world of investing, is often celebrated for her stock-picking prowess. However, what may surprise many is that Dolly Khanna is, in fact, a homemaker. The real driving force behind their successful investment journey is her husband, Rajiv Khanna. Rajiv Khanna, a Chennai native, holds a unique position in the investing landscape, preferring to invest under his wife's name.
- Oct 04, 2023