There are several benefits of opting for a term insurance plan. For starters, these policies are incredibly useful in securing your family financially in case something unfortunate befalls you within their tenures. Your family members can use the payouts to take care of their expenses and future goals, minus any compromises or dependence on others. Hence, it is a must to purchase these plans as early as possible. Yet, many people shy away from buying them due to several wrongful misconceptions or myths. Here’s busting a few of these myths in this article.
Term Insurance Plan Myths that Should Be Busted
When it comes to purchasing a term insurance plan, there are various common myths that need to be busted. Here are some of them:
- These plans are expensive – It is probably the biggest myth of them all since term plans are more affordable than other life insurance policies. Also, they help you get a higher coverage amount for a lower premium. If you start early, you can lock in a lower amount for the whole policy term. Kotak e-Term Plan is a great example of a policy that offers high coverage at a competitive premium, ensuring financial security without straining your budget.
- It is too early to purchase them – As mentioned above, the earlier you buy, the higher your chances of getting a higher coverage amount for a lower premium. This is because insurers will see you as less risky in terms of health and other complications, which will lead to a lower premium.
- They are only good for death benefits/payouts – This is another myth that you should stop believing. While the core feature of the plan is the death benefit or sum assured payout, you can also choose riders to enhance your plan. A critical illness rider, for example, pays out a fixed sum upon the diagnosis of a covered illness. Then there is a waiver of premium, accidental disability and death, and many other riders that can financially safeguard your family in various scenarios. However, not all insurers provide every type of rider, and these come at an additional cost.
- Term plans are rigid with no scope for flexibility – This is another term insurance plan myth that is being wrongfully circulated. Many insurers allow you to flexibly increase coverage with growing responsibilities and income. You can also flexibly customise your premium payment frequency, the nature of the payout (lump sum/monthly income or a combination of both), and so on. Kotak e-Term Plan, for instance, offers multiple payout options to ensure your family receives financial support in the most convenient manner.
- It is better to invest than get term insurance – One of the myths that people have relates to only investing money without securing adequate financial backup for their loved ones. While investments are essential for wealth creation, they do not replace the security of term insurance. Term insurance provides a guaranteed payout to help your family meet costs and maintain their lifestyle in case of your demise. Unlike market-dependent investments, term insurance offers assured financial protection. Even insurance-cum-investment plans often provide lower coverage than pure term plans.
So, busting these myths related to term insurance plans is a must. You should stop believing them and instead look for a good plan to purchase early in your career. Kotak e-Term Plan is a solid option that not only provides extensive coverage but also gives the flexibility and affordability you need to secure your family’s future. Investing in the right term insurance early on will help you get high coverage and safeguard your loved ones from life’s uncertainties.
