Life insurance: Buying life insurance is an easy way of investing along with securing the future. With increasing awareness more and more people are buying life insurance. But sometimes some mistakes happen while buying life insurance. Most of these mistakes are due to lack of information. Let us know what are the mistakes that people usually make while buying insurance.
Multiple policies at once
Many people buy multiple policies at once. People have a misconception that by doing this they and their family will be more secure, but this thinking is not correct. Life insurance cannot be seen merely as a tool to come in handy in times of trouble. It is not that it will come in handy only in case of an accident. The sum assured required by the policyholder is the sum of their future financial goals and current liabilities.
Delay in buying a policy
When all is going well with us, we think about what insurance we need right now. This is where the mistake happens. Insurance premiums are also low at a young age and full benefit of their maturity is available. The premium amount also increases significantly with age.
Insurance in the name of the child
This is a very common mistake that people usually make. Remember that life insurance is a way to protect the family from loss of future income and current liabilities.
Keep insurance short
Most people buy short term insurance to reduce the premium. But life insurance should ideally cover the risks of the policyholder’s entire life.
Giving false information
Another serious mistake people make while taking life insurance is giving false information about themselves in the policy. For example, many people do not give accurate information about their health or habits. It may not seem like a big issue in the beginning, but later on such mistakes can make the policy completely invalid.
