Top 5 insurance myths that you need to bust NOW

When it comes to insurance, most of you shirk away from it. In spite of the innumerable benefits bestowed by an insurance plan, people shy away from it. Why? The reason is a lack of knowledge. Insurance is a technical concept which escapes the understanding of many. Other than the premium cost and the benefits promised, most of you don’t want to go deeper into the concept of insurance. As they say, a little knowledge is a dangerous thing and, therefore, limited knowledge of insurance gives rise to many myths. Most of you believe in these myths and don’t buy insurance. Are your myths justified?

Of course they are not. Here are five popular myths which most of you have along with their cold hard facts. Bust these myths NOW

#1 Life insurance is not worth the investment

When you put it this way, life insurance is not. But do you see the bigger picture? Life insurance is a tool of financial security. It secures your family financially in case you, the bread-winner, were to die prematurely (God forbid!). It, therefore, buys you financial security in case of an emergency, something which you can’t get with any other investment avenue. So stop looking at life insurance as an investment. If you want returns, look elsewhere. Life insurance is a gift of financial stability which you can give your family in your absence. When you talk about premiums, term plans guarantee such minimal rates that the benefits far outweigh the trivial amount you invest.

#2 Medical underwriting is just a formality

Is it? Then why can your claims be rejected if you lie about your medical health?

Your medical health is a very important consideration in both life and health insurance plans. It is important because of the simple reason that your health affects your longevity. If you are sick or have been sick, the insurance company undertakes a higher risk because any medical complication might cause death and a subsequent claim. That is why medical underwriting is done with utmost care. If your risk is found to be higher the company might either reject accepting your policy or accept it at higher premiums. If you lie about your medical health, your claim faces the danger of rejection. So, always fill your proposal form yourself and provide all the required medical information correctly and truthfully.

#3 Insurance companies don’t pay a genuine claim

This is a very common misconception which many individuals believe. They feel that though they pay premiums, their claims have a high risk of rejection because the company is perceived to be untrustworthy. It is not true. The insurance company cannot reject your claim if you correctly and honestly fill your proposal form at the time of buying the policy. If you provide all the required information without lying, the company knows the risk it is accepting. As such, they cannot reject your claims and are forced to pay the total claim as and when it arises.

#4 Stay-at-home parents don’t need life insurance

Don’t they? Aren’t they financially useful? Think of all the chores a stay-at-home parent does. Grocery shopping, cooking, laundry, keeping the house clean, looking after your kids and managing your entire home are not easy tasks. Stay-at-home parents multitask and complete their chores. In fact, as per an article in Economic Times, the average monthly salary of a home-maker is about Rs.45, 000 (Source:https://economictimes.indiatimes.com/news/economy/indicators/how-much-salary-should-a-homemaker-get/articleshow/61761686.cms) In the absence of the stay-at-home parent, you would have to engage the services of a maid, a cook, a personal shopper and what not. Don’t these appointments cost money? Stay-at-home parents definitely have a financial worth and they too require insurance coverage.

See how much India spends on health costs

#5 Term insurance is cheap. Why hurry?

Yes, term insurance is cheap. The premiums are peanuts compared to the benefits promised. But do you know that the premiums depend on age? Yes, as you age your premium increases. Why pay an additional premium outgo every year by delaying a term plan? Moreover, as you age you develop medical complications. These complications increase your mortality risk and your premiums are loaded to compensate for the high risk. Therefore, it is always advised to buy a plan younger.

Which of these myths do you believe in?

Bust your myths about insurance. Insurance is a financial life-saver when emergency strikes. So insure yourself against financial disasters and have a secured life. When buying insurance choose Turtlemint. You get the facility of comparing between the different plans before buying one. Moreover, Turtlemint offers you claim assistance too. So, understand the necessity of an insurance plan and insure yourself today.

Read more to know why insurance is necessary.

Read more about Separate health insurance plans for parents or floater?

Read more about Common terms in life insurance policies

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