Compared to several western countries, India’s insurance industry is still at a nascent stage, with only about 3% of the population covered under a life insurance policy. Add to it the complex technicalities and terminologies of life insurance plans, and you have an industry rife with misconceptions and myths.
The myths often discourage people from purchasing life insurance and even influence their buying decisions. To help you choose the best, here we are busting 5 of the most common life insurance myths-
1. I am Young and Don’t Need Life Insurance
It is great that you are young and in the pink of your health. But does that also mean you are immune to death? While we never think about death, especially when we are young, it is one of the biggest realities of life for everyone, irrespective of their age.
In fact, one should purchase a life insurance plan as early in life as possible as the premiums are generally lower when you are young.
2. I Have Group Insurance from My Employer
Group life insurance plans that are generally offered by employers often come with minimal life coverage. The low coverage amount might not be adequate to provide financial stability to your family after your unfortunate demise.
It is also worth noting that the group insurance will only be valid as long as you work for the same employer.
3. Life Insurance Only Helps After Death
A lot of people might not want to purchase something that they cannot benefit from during their lifetime. But it is essential to understand that the primary objective of buying life insurance is to safeguard the financial future of your loved ones after your demise.
Moreover, if you’d like to benefit from the life insurance plan when you are alive, you always have the option to consider plans like endowment life insurance, ULIPs, or TROPs that come with maturity benefits on survival.
4. Life Insurance is Expensive
Gone are the days when life insurance used to be expensive. You can now find an extensive range of life insurance plans that come with comprehensive coverage at reasonable prices. Even if you are young and just started your career, you can still purchase a feature-packed plan.
In fact, with some of the top insurers in the country, you can purchase a term plan with Rs. 1 crore cover at just Rs. 500/month. Not to forget that you’ll also get tax deduction under Section 80C for purchasing life insurance.
5. People with Existing Health Problems Cannot Purchase Life Insurance
There are insurers in India who offer life insurance policies even to individuals with existing medical conditions. But as compared to someone not suffering from such conditions, people with existing health problems are required to pay higher premiums.
Even with higher premiums, one should still consider the purchase as it will bring them under the safety net of a life insurance policy.
Only Trust Insurance Experts
The myths are so prevalent in the country that it is very easy to fall prey to them. But one should not believe everything they hear from their friends or relatives or read online. Unless they are an insurance expert, the people sharing their insights might also be influenced by these common myths.
One of the best ways to avoid such misconceptions is to look for a reputed insurer and get answers to all your queries from an expert.