2 Key Things To Be Careful About Before Buying Life Insurance
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Purchasing a life insurance policy for yourself is really a task. It is not an easy buy. The first step is to make sure you have some basic understanding of life insurance. Different life insurance policies offer different benefits. To meet disparate customer needs, insurance companies offer add-ons to basic life insurance covers. The add-ons are called riders to the basic policies. The riders are for critical illnesses like a heart attack, death by accident & for income benefits on disability.
2 Things To Keep In Mind While Buying Life Insurance
The next step involves the critical part of deciding which life insurance product provides the best solution to your requirement. The first 2 things you need to consider are:
1. Assess Your Insurance Needs
What is your contribution to the family income and how much is dependent on you financially. Is there anything that your family can depend on to meet expenses and repay debts after your premature death? Answers to these questions should help you decide how much coverage you need. Consult an insurance agent who can give you information on life insurance products as well as someone who can help you in evaluating your insurance needs. The assessment exercise should ensure the amount of life insurance cover you buy will provide the much-needed financial protection to your family after your death
2. Compare Insurance Policies
The two basic types of life insurance are term insurance and savings-cum-protection insurance. Term insurance provides indemnity against events that would otherwise be financially distressing. Term insurance is cheap – a large insurance cover can be had for a smaller premium.
There is no payment made by the insurance company if the insured survives the policy period. In contrast, savings-cum-protection insurance gives you a maturity benefit which is equal to the sum insured plus bonus additions. Term insurance is only for financial protection of your dependents against an unforeseen event where you do not receive any personal benefit. Your choice should depend on your needs, both immediate and future.
Conclusion
Take the help of your insurance agent to understand the finer points of your policies. Exclusions – events that are not covered by your insurance policy – are critical. Know them before you buy the insurance policy rather than leaving you and your dependents in shock when the moment of truth strikes.
Also read - Why Should I Buy Term Insurance Plan Online?
Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.
