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Term insurance plans are the most important and perhaps the best life insurance policy you will need, but it is very likely that your insurance agent has no interest in selling one to you. Let's find the truth about why insurance agents don't sell you term insurance plans.
Term insurance plans are important and economical insurance plans in the market. The premiums of term plans are very low, and that is what makes them an affordable insurance option for many. If you are the only breadwinner of the family and looking for affordable life insurance plans, then term insurance is the best available option for you. However, even with so many benefits, most of the insurance agents avoid selling term insurance plans to the buyers.
The primary duty of an insurance agent is to understand your life insurance needs and suggest a policy accordingly. However, in most of the cases, the insurance agents look after their benefits while selling insurance policies and rule out your insurance and financial needs. Some insurance agents even avoid informing you about different types of life insurance plans because they don’t earn enough commission from them and one such product is term insurance plans. Let’s understand why insurance agents don’t sell you terms plans.
Term plans are cheap as compared to other life insurance plans. This is mainly because term plans give you larger cover for your life without giving any maturity benefits, and that is the reason why the premium of term plans are low as compared to other life insurance plans. A term insurance policy keeps your family financially secured in case of your untimely death and it will give death benefits to your family only in case of your death during the policy term. Term plans do not provide any survival benefits. It is important to understand that the commission of insurance agents depends on the amount of premium paid by the policyholder. In the case of term plans, the premium paid by the policyholder is very low and hence it yields low commission for insurance agents. Therefore, insurance agents avoid selling these plans as they give them a low commission.
Many buyers avoid life insurance plans which give them no return and term plans fall in the same category. Customers think that they will have to die to get the benefit of a term insurance policy and this is the reason why many people do not want to go for term insurance plans. However, people fail to understand that the cover provided by term plans is quite large as compared to other life insurance plans. Therefore, it becomes difficult for insurance agents to make buyers understand the benefits of term plans and that is why many agents keep themselves away from the hassle of selling term insurance plans to customers.
Despite the fact that term plans are very profitable for insurance companies, very little training is given to insurance agents for selling these plans. Many insurance agents focus on selling investment plans which give them higher benefits in the form of commission. Some insurance agents are not even concerned to learn about term insurance plans which make their offers for the buyers to be limited to high commissioned insurance products.
In India, many people are not aware of term plans. And since, buyers don’t ask about it, many agents don’t bother to explain about term insurance plans at all. When customers have a little or no knowledge about term plans, insurance agents might rule out this option as they know that customers are not aware of the benefits of term insurance plans and he could easily sell an insurance policy which earns them higher income.
As a customer, it is recommended to be aware of different insurance and investment products available in the market. This helps you to choose the best plan for you and your family. A good insurance plan is the one which is bought by understanding your insurance and financial needs otherwise it may become useless for you. In many cases, insurance agents try to sell you a plan which is beneficial for them and not for you. They prefer selling products which earn them higher commissions and you end up paying a higher premium for a policy which may or may not give you benefit when required.
It is advisable to ask about different types of life insurance plans to your agent and if you are not satisfied with his/her response, you can always look for another agent who will help you buy the best insurance policy. You can also compare and buy a life insurance policy online without the involvement of an agent. Reliable information and easy process make online insurance purchase a smooth experience.
Recommended Link: Renewal of Term Insurance Policy