Life assurance is among most critical components of the financial plan of an individual. However, there are many misunderstanding about life assurance, mainly due to the way assurance products have been sold over the years. This article highlights some of the most common mistakes to avoid when taking Life insurance Mississippi.
Underestimating assurance requirement: Many buyers of this type of assurance select their sum assured based on the plans sold to them by their agents and the amount of premium they can afford. This a wrong approach. Your assurance requirement is a function of your financial situation and has nothing do with what products are available.
With such an increasing number of women health issues, women should not keep themselves without a L/I cover. Again 1 in 3 people are likely to suffer from critical illness. This way, L/I cover is vital for both men and women. Ignoring a L/I cover could prove fatal as your family would be left with many financial burdens.
Contents assurance is enough! Contents assurance is enough! This is another misconception. While we get our car, house, laptops and other accessories insured, we tend to take for granted the most important part of the family, i. E., its members. Losing a family member, particularly if the individual was the sole breadwinner may amount to a sudden financial challenge.
The next type of policy is whole L/I. As the policy states, it is good for your entire living usually until age 100. This type of policy is being phased out of many L/I companies. The whole L/I policy is called permanent L/I because as long as the premiums are paid the insured will have L/I until age 100. These policies are the highest priced L/I policies, but they have a guaranteed cash values.
You should consider metrics such as claims Settlement Ratio and the length of death settling claims of various Insurers. To choose an insurer, which will fulfill its obligation in meeting your claim promptly, should such misfortune arise. Data on these metrics for all the assurance companies is available on the internet. Also, you should check claim settlement reviews online, and then opt for a company with a good track record of claims settlement.
Treating this assurance as an investment and buying the wrong plan: The common misconception about life assurance is that, it is also as a good investment or retirement planning solution. This misconception is largely due to some assurance agents who like to sell expensive policies to earn high commissions. If you compare returns from life assurance to other investment options, it simply does not make sense as an investment.
If you are a young investor with a long time horizon, equity is the best wealth creation instrument. Over a 20-year time horizon, investment in equity funds through SIP will result in a corpus that is at least three or four times the maturity amount of the assurance plan with a 20-year term, with the same investment. Life assurance should always been seen as protection for your family, in the event of an untimely death.
Underestimating assurance requirement: Many buyers of this type of assurance select their sum assured based on the plans sold to them by their agents and the amount of premium they can afford. This a wrong approach. Your assurance requirement is a function of your financial situation and has nothing do with what products are available.
With such an increasing number of women health issues, women should not keep themselves without a L/I cover. Again 1 in 3 people are likely to suffer from critical illness. This way, L/I cover is vital for both men and women. Ignoring a L/I cover could prove fatal as your family would be left with many financial burdens.
Contents assurance is enough! Contents assurance is enough! This is another misconception. While we get our car, house, laptops and other accessories insured, we tend to take for granted the most important part of the family, i. E., its members. Losing a family member, particularly if the individual was the sole breadwinner may amount to a sudden financial challenge.
The next type of policy is whole L/I. As the policy states, it is good for your entire living usually until age 100. This type of policy is being phased out of many L/I companies. The whole L/I policy is called permanent L/I because as long as the premiums are paid the insured will have L/I until age 100. These policies are the highest priced L/I policies, but they have a guaranteed cash values.
You should consider metrics such as claims Settlement Ratio and the length of death settling claims of various Insurers. To choose an insurer, which will fulfill its obligation in meeting your claim promptly, should such misfortune arise. Data on these metrics for all the assurance companies is available on the internet. Also, you should check claim settlement reviews online, and then opt for a company with a good track record of claims settlement.
Treating this assurance as an investment and buying the wrong plan: The common misconception about life assurance is that, it is also as a good investment or retirement planning solution. This misconception is largely due to some assurance agents who like to sell expensive policies to earn high commissions. If you compare returns from life assurance to other investment options, it simply does not make sense as an investment.
If you are a young investor with a long time horizon, equity is the best wealth creation instrument. Over a 20-year time horizon, investment in equity funds through SIP will result in a corpus that is at least three or four times the maturity amount of the assurance plan with a 20-year term, with the same investment. Life assurance should always been seen as protection for your family, in the event of an untimely death.
About the Author:
Get a summary of the things to consider before selecting a life insurance Mississippi company and more information about a reliable company at http://www.sunbeltinsurancefl.com/about now.
No comments:
Post a Comment