Different people have different reasons to buy a term insurance plan. Some reasons are strange, while some are straight to the point. Find out the most immature reasons people buy term insurance for!
“Did you even ask yourself the reason for buying a term insurance plan?” If not, better ask now. After all, your motivation to buy a term plan should be crystal clear before you sit down and find an appropriate one for you.
It is imperative that you minutely analyze your requirements from the plan you wish to opt for and set an expectation accordingly.
“Don’t think about term insurance as an obligation. Look at it as a necessity! “This is why you should know the benefits of the insurance plan you finally want to zero on.
People unknowingly buy insurance plans without knowing the benefits they could reap out. There are few of them who buy a term plan for all the possible wrong reasons.
Below are 7 of the most immature reasons to buy a term plan.
1. My best friend just bought a term plan, so I should buy one too.
Copying someone’s financial decision is as easy as copying someone’s fashion or style. But, what if you realize that the dress you copied doesn’t suit you or fit you after paying a hefty amount? Sad, but that’s the truth.
So, it’s good to borrow ideas from others. But copying someone’s financial decisions, for example, buying a term plan exactly like someone else’s would indeed make you regret in the long run.
Simply because your friend’s or a colleague’s requirement for a policy is different from a policy would differ from your friend or a colleague.
2. That insurance agent is after my life to buy a term plan.
Okay, we know that the insurance agent is your friend or a relative or a friend’s relative or a relative’s friend, who’s literally pestering you to buy a term plan. But, don’t buy just because he is after your life to buy one.
Sit down and take some quality time to understand the term plan he wants you to buy. Ask him questions till you are actually satisfied and educated about the plan’s terms and conditions, features, exclusions and inclusions etc.
Make this move as the most wanted opportunity because the end result may turn out to be simply great!
3. My company has already covered me and my spouse by offering a term plan at a lower premium.
Oh yes, everyone wants to save their hard-earned money. But, buying a term plan just because your company is offering it at a lower premium wouldn’t make sense. This is because, lower premium is equal to lower coverage.
Would you like your family to suffer once you’re gone simply because your term plan wasn’t sufficient enough to take care of your financial burden?
Certainly not! This is why it makes sense to buy a term plan that covers you sufficiently, but not at the cost of a lower premium.
4. Now that I am planning to buy a house, I should think about getting a term insurance plan.
Some might consider this as a sensible reason to buy a term plan, while some might find it too immature. Agreed that you are ambitious enough and you are doing pretty well to buy a 2BHK in Mumbai.
But, buying a random plan without considering the benefits of the plan, the coverage it offers, etc. just to get a tick on your to-do-list wouldn’t make sense.
So, opt for customized or tailor-made plans that would offer you a coverage you are looking for.
5. I should invest in a term plan because of all the increasing expenses.
This idea sounds great, but only if it gets executed properly. A term plan would take care of your financial burden like loans, mortgage, etc. once you are gone. It would be the best thing you can gift your family so that they would be able to lead a comfortable lifestyle and pay off your debts in your absence.
Therefore, investing in a term plan would sound promising if you start at an earlier age to avoid getting piled up with additional increasing expenses.
6. My colleagues would talk about me buying a term plan and soon it would be a topic at office.
Oh, do you really think that’s going to be a massive discussion? I can understand you telling your colleagues about your term plan , and they talk about it.
But, is insurance a topic or a gossip where someone can talk endlessly again and again? Certainly not! There are better things to do at work than discuss about the insurance plan you bought! Because, insurance is something that would be valid for years.
7. It’s JFM and I need to invest somewhere to save on my tax. So, let me buy a term plan.
Again, it sounds promising, but would make sense only if bought with a proper planning and execution. Don’t buy any term plan just for the sake of saving on some tax.
Get a plan as per your requirements. You might end up buying a term plan to get a higher tax deduction that’s not at all pocket-friendly. Ultimately, you waste a bigger chunk of your hard-earned money with zero results!
So, don't buy a term insurance plan for reasons as immature as those listed above. Buy one for a right reason and as per your requirement. Be a responsible adult and think maturely. Refrain from buying a policy just for the heck of it. You might buy a term plan with a motive to save tax or adapt someone else’s financial decision. But, unfortunately, you would end up with an insufficient coverage. Therefore, think twice before finalizing a term plan because we want you and your family to be secured both financially and emotionally.