If you agree to the fact, that you can do anything for your loved ones, you can never deny the importance of life insurance. Life insurance policy not only protects your family but blesses you with peace of mind too.
However, even after being such an important decision of our life, the term “life insurance” is mostly seen as an awkward topic of discussion. One of the main reason behind the reluctance is the scary thought of imagining our own death. In addition, there are many more misconceptions surrounding the subject that restricts us from understanding its importance.
Today we will discuss some of the most common myths surrounding the topic that increases our hesitation in investing in a life insurance, which is actually the best protection for us and our family.
Myth 1 – I will have to undergo a thorough medical examination
A medical checkup is only suggested by the insurer or the insurance company if you have opted for a high sum assured under a term insurance plan or have a chronic medical history or a health problem. If you have never been under any surgery or have met any serious injury, it is quite unlikely that you will be asked to undertake any medical checkup.
Myth 2 – A yearly medical checkup is required to maintain my life insurance policy
Once you have completed all the required paperwork regarding your insurance policy, you won’t require any regular medical checkup to maintain the policy.
Myth 3 – As I am not working I do not need a life cover policy
Remember, your life cover is not about a monetary profit or loss, especially housewives. This policy will ensure the safety of your family, after your death. Therefore, even if you are not the earning member of the family, your life insurance can help your family stay strong when any financial crisis hits them.
Myth 4 – I am married, hence I should only go for a joint life policy
Selecting a joint life insurance policy for you and your partner, completely depends on your personal choice and circumstances. There is no hard and fast rule that married couples should only opt for a joint policy. Although the joint policy will cost you much less than two separate policies, it will never be as flexible and extensive as a separate policy.
Myth 5 – I need a good credit score to secure my family
One of the biggest myth is that you need to have a good credit score to get a life insurance policy. It is important to know that your insurer or the insurance company never check your credit history to grant you a policy. In case you fail to pay your premiums after taking the policy, the insurer has all the rights to terminate your policy cover.
Myth 6 – Term life insurance policy is not flexible and it won’t benefit me
A term life insurance policy is as flexible as any other life insurance policy and it has its own benefits for your family’s secured future. If you choose your term life insurance policy smartly, you can even get an option to convert the same into a permanent life insurance policy.
To do so, before taking the policy talk to experts up front, about the terms and conditions, and specific time period for the conversion. However, if you do not want to change your term life insurance policy into a whole life insurance or a permanent life insurance, you can enjoy other additional benefits like fixed premiums and lower costs.
Myth 7 – If I combine critical illness cover with life cover, I will get paid only for one
It completely depends on the type of policies you have chosen, so if you have a comprehensive policy which pays accelerated benefits, then on diagnosis a part of the sum assured is paid and the remaining on death. If the benefit is additional or over and above the basic sum assured, then you will receive two payouts i.e. one on diagnosis and another on death. However, the premiums charged to you will also be different.
Myth 8 – My beneficiaries will be charged income tax on claiming my life insurance policy.
One of the benefits of life insurance is that the maturity pay-pout is tax-free. Hence, none of your beneficiaries will have to file or pay income tax for the policy cover. Your life insurance is provided to your family to help them lead a worry-free life, and pay for things like living expenses, mortgage and more.
It is always beneficial to compare different life insurance policies before buying one because a well thought decision over a life cover plan can decide the financial wellness of your family after your final exit.