Abhishek Kurahatti
by on September 20, 2021

Uncertainty is all around us, more so than today with the ongoing COVID 19 Pandemic. The consequences that it has brought with it have heightened insecurities in the mental health of a lot of us. The need to feel secure and exercise a stronger sense of control in our lives and well-being is higher than ever. How many of us would have considered investing in a life insurance plan or an endowment plan just in the past year?


Investing in a smart life insurance plan is one of the most secure means to protect you and your loved ones against various life uncertainties such as mishaps, accidents, loss of income, death of a breadwinner, etc. Today life insurance plans are also designed bearing in the mind the need of families to meet predictable short-term and long-term financial goals. They are packaged with a list of benefits to help policyholders and their dependents plan financial goals and overcome financial crises smartly. 


However before one plans to invest in an insurance plan, it is would be advisable to understand and eliminate the myths and misconceptions around it. Knowing facts is that which can help one make an informed decision and reap all rewards a life insurance plan can offer. 


Myth 1: Life Insurance can be used only after the death of the policyholder. 


Reality: Endowment plan is a life insurance policy that provides the policyholder with a combination of both an insurance cover, as well as a savings plan. It helps save a specific amount systematically over a period of time to obtain a lump sum on policy maturity- provided the policyholder survives the term.


Myth 2: Life Insurance is a complex product; with technicalities receiving the benefit is difficult.


Reality: A term life insurance plan offers a pure life cover and promises to pay a sum assured if the policyholder dies within the policy period. If he or she outlives the term, there is no maturity benefit. An endowment plan offers a life cover as well as a savings option while ULIP splits the premium paid to provide for your life insurance cover as well as to invest in products such as bonds, stocks, or mutual funds.


Myth 3: The rates of return is low, then why invest in one as against other financial products?


Reality: With a life insurance plan, all of your premium payments are put toward as death benefit to your beneficiaries, which means you part with small premiums in exchange for a large death benefit. Now can there be a greater return than reassurance?


Myth 4: Life insurance can only be used after the policy holder's death.


Reality: Most life insurance plan these days provide options of regular monthly income, lump-sum benefits and additional coverage option through the tenure of the life insurance policy. 


Myth 5: One doesn’t need to invest in life insurance at a young age.


Reality: Planning to invest in life insurance or an endowment plan right when an individual develops a steady footing in generating income, not only assures life cover but a much-needed guarantee to handle sudden unforeseen expenses. 



Investing in the right life insurance plan or an endowment plan is no more an option; it is a financial decision that will positively influence the quality of life for the individual and his loved ones.

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