Before buying any policy you must know and verify the facts. You also need to understand what your insurance agent says and what it means so that you don't end up buying wrong policy. Read on to know more...
“Half knowledge is dangerous”.
To ensure that you don’t go to your insurance agent with half knowledge finding facts is a better solution. Rather than buying a wrong policy, you should cross-question and know the facts behind their statements.
Want to know what your insurance agent might be hiding from you?
What insurance agents says and what it actually means
1) Agent: The best investment is an endowment policy – invest now and reap huge benefits later.
Caution: Wait! Wait! Wait! Check why?
It’s time to alert yourself.
Agents tend to overplay the advantages of endowment policies. The reason being they get a higher commission on endowment policies over a term life plan.
Premium of an endowment policy is more in comparison to a term-life plan. Hence, more sales of endowment policies mean more commission agent receives.
As an empowered consumer, try to see through the race and ensure you ask relevant questions.
2) Agent: You don’t have to worry about the premiums, pay monthly or quarterly.
Caution: Chances are, you may end up paying more...
If your agent says,
“You don’t have to worry about the premiums, pay monthly or quarterly.”
“Monthly small payments won’t cost you much – it’s a saving with great returns.”
Then you may end up paying much more amount than if you pay annually.
Yes, small monthly payments are easy to pay. But you end up paying more money by the end of the year as compared to an annual payment. It is advisable to pay annually as many insurers offer discounts on annual premiums.
Even when compared to an annual premium of endowment plans, premiums for term policy are far lower. That’s because, term life plans are a pure death benefit cover and do not include any investment part.
3) Agent: It’s okay to NOT disclose all mandatory details to your insurance company.
Caution: Lowers premium in the short run, but a big loss in future!
Who does not want a little more when it comes to benefits and a little less when it comes to spending? However, note this is not a smart strategy in all scenarios.
Calculation of a life insurance premium is dependent on factors – age, gender, smoking habits, etc.
While, many try to save money by not disclosing the facts. But, at the time of claim the whole policy might get rejected due to false declarations.
Never hide or conceal anything, no matter how tempted it might sound. Look at the broader picture, especially, when it comes to pure life insurance.
4) Agent: Sum Assured is enough for your family’s future.
Caution: Did you prospect all scenarios?
You need to ask yourself whether the amount of sum assured is sufficient by the end of the tenure, say 30 years. Or, how much will be the sum assured in case of partial or total permanent disability and death?
Since a term plan is a pure death benefit cover, where the sum assured is quite higher. Additionally, to enhance your cover you can opt for riders.
Some options for riders are - Personal Accident, Critical Illness, Premium Waiver, etc.
5) Agent: Buying online is difficult and costlier.
Caution: It’s a myth. Check and compare online now.
Not only buying online is easy, but also cheaper.
Agents may not reveal it, but here’s the truth – buying a term-life plan online is much cheaper and convenient.
Buying plans online has lower operational costs as compared to buying plans offline. Buying offline involves more cost - handling operation cost or appointing an agent. These benefits are then passed down to the customer in the form of discounted prices.
Another benefit of buying online is that you avoid paying any hidden costs.
Before buying any plan you must verify all the facts to ensure you don’t end up buying a wrong one. The best way to do it is to check online.
Comparing plans online not only save time, but also gives you an insight to buy the right plan for you and your family. You can compare plans at Coverfox.com or talk to our experts over a call at no cost.
Recommended Read: The Tax Saving Plan That Most Agents Will Hide From You