Why You Should Buy Life Insurance and from Whom

Why do we need Life insurance Policy? Why it is necessary to me?  The answers to these questions are similar to - Why do we all marry? Why we all need kids? Why we marry and have kids is an endless argument. But the requirement of life insurance is needed for all. The value of its sum assured is differs from man to man.  If you are the sole bread winner of your family, then insurance is the only hope which supports financially your family after your departure. A Life Insurance Plan is very much essential if you bother who will take care of my family if something happens wrong to you tomorrow. How they will survive without you?

7 Reasons Why You Should Buy Life Insurance Policy:

1.         An Alternate to your income:  It can be your substitute income wise to your dependents if you are prolonged ill or died prematurely.

2.         A Good instrument for kids education: Life insurance premium paid by you will take care lifelong for your kid’s education.  It will allow them to live their life.

3.         May be a good investment instrument: The various plans available with almost all life insurance companies suit every individual according to their need. For e.g. ULIPs (Unit Linked Insurance Policies) / Endowment Plans etc.

4.         A substitute to Partner’s Income: It helps you to support financial even after demise of your spouse or business partner.

5.         A tax saving instrument: Under section 80 of income tax, a plan wise tax rebate is available for policy holders.

6.         To Buy at early age is better: As we understand that it is need of every individual.  So if it is taken at early age the premium will be less as compared.  

7.         A helpful investment at financial crisis:  The policy owned can be surrendered or partially withdrawn in case of financial hardship.

How to Buy Life insurance and from Whom

For many people, their first experience with life insurance is when a friend or relative gets an insurance license he tries to sell its product to his near and dears first. In my case, a college friend, recently hired by a major insurance company, contacted me and sold me a policy. Even truly speaking I was not in mood to purchase it. But is life insurance something that you truly need, or is it merely an inconvenience shoved under your nose by a salesperson? As a true advice I recommend that you should but it from an authentic person after comparing the similar plans of another company. While it may seem like the latter is true, there are actually many reasons as enumerated above, why you should purchase life insurance. But before buying it we must adhere the following points:

1          Think through why you are buying insurance and what core requirements and expectations

2          Seek and receive advice and options patiently. Be open-minded but cautious about the advice and information you gather Ask lots of questions about the policy options to see what fits your needs Find out policy details like: Whether it is a Single Premium or Regular Premium policy Which is the best premium payment frequency that suits you eg: Annual, quarterly etc. Whether there is an ECS (Electronic Clearing Service) payment option to make your premium payment safe and easy

3          Fill the proposal form very carefully and personally. Fill it completely and truthfully, Remember you are responsible for its contents Make sure that the information you give cannot be disputed during a claim Ensure you fill Nomination details If the form is in one language and you are answering the questions in a different language Ensure the questions are explained correctly to you and That you have understood them completely Remember you have to give a declaration to this effect in the proposal form

Keep a copy of the completed proposal form you sign and any declarations and terms agreed upon mutually for your records.

If you are buying Unit Linked Insurance Policies (ULIPs) ask specific questions about:

(i)            Various charges.

(ii)          Fund options.

(iii)         Switching of funds.

(iv)         Benefits if you.

Discontinue the policy

Surrender the policy

Make a partial withdrawal of funds