Reasons To Not Quit Life Insurance Policy In Between The Policy Term

There might be times when you feel that keeping your insurance plan going is not worth it. Whatever the reason might be for such a conclusion, you should try reconsidering your decision. To help you out, here are some reasons to not quit your life insurance policy in between the policy term.

Reasons Not to Quit Life Insurance in Between Policy Term

The list includes:

• Wastage of Money

If you quit your life insurance policy in between the policy term, you will lose a chunk of the premium amount you had paid till then. Cancelling your life insurance policy in the middle of the policy term leads to this penalization. It happens in the form of surrender charges.

The surrender charge is deducted from the total amount of premium you had paid till then. The remaining amount is returned to you, which might be way lesser than what you had saved within your plan. The surrender charge depends on several factors such as the amount of premium you had paid till the time of cancellation, the policy term of your life insurance plan, etc.

• Reassurance for Your Loved Ones

Having a life insurance plan leads to a stress-free future for you as well as your loved ones. In the unfortunate case of your death, your family will have financial security. This becomes even more important if it is sudden. To be left without any financial support can be infinitely difficult for those who have to live on. Therefore, you must also think about the well-being of your loved ones before you cancel your life insurance plan before the policy term is over.

• Reapplication Later May Cost You More

If you feel your health is improving and there is no need for a life insurance anymore, you might be making a mistake that will cost you heavily later on. There is no telling when your condition might worsen. Plus, you will also age more later on.

The amount of premium you have to pay depends on your age and health condition. The older you are or the worse your condition, the more is the premium you have to pay. So it is better to start with your life insurance early in life and continue paying for it. It will benefit you later on.

• Profitable Returns

Life insurance plans offer great returns on all the savings you would be doing. Whether it is at the end of the term or in case of a death, an insurance plan is assured to give you better financial support than perhaps any other investment scheme.

This also helps if you are not under a pension plan as there is income for you even after you retire! If you have life insurance, you will receive annuities which can help support you and your family even after you retire.

• Easier to Get Loans

Having life insurance makes it easier for you to get a loan. The interest rates are usually lesser than what you would have to pay had you not had life insurance. The amount of loan you can acquire depends on the type of your life insurance, the amount of premium you have paid and the surrender charges.

Endnotes

There are a lot of benefits of having a life insurance plan. There are also disadvantages if you cancel it. Therefore, it is imminent that you judge wisely and make the best decision to benefit you and your family. 

Also Read 

Why Women Should Buy Life Insurance?

10 Life Insurance Terminologies a Policyholder Should Know

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.