Life Insurance Tips And Facts
Life insurance policy is not something that people buy daily. It is important for people to know what they are getting themselves into before buying one. Here are some life insurance tips And facts.
Some people have vowed to never buy an insurance policy because of something they heard, which may not be necessarily true.
There are some important facts that people don’t know of, and these facts could help people make better decisions.
The life insurance industry is no different from other sectors. It also associates with several myths, and some tips and facts can help potential policy buyers.
Naming a minor as beneficiary – Life Insurance Tips And Facts
A policyholder should not name a child under the age of 18 to be a beneficiary of his/her policy. Minors cannot be directly paid out the death paid cover until they reach the age of 18.
The bad part is that if the child depends on the death cover for financial support, he/she will suffer a great deal because a life insurance company will not pay the money to a kid.
Another disadvantage is that if a child receives a lump sum at the age of 18 without any financial discipline, he/she might spend the money on unnecessary things and lose all the money overnight.
Parents can create a life insurance trust for their children that gives instructions on how the death cover will be used. That way, the money will be put to wise use.
When a person buys a life policy, he/she must get benefits that allow him access to the money in case something happens to him/her when he/she is still alive.
One example is the disability cover. It allows the policyholder access to the money if he/she is accidentally disabled and can no longer take care of himself/herself financially.
Comparing policies and asking for advice – Life Insurance Tips And Facts
If a prospective policyholder is unsure of the policy, he/she wants to buy. He/she must ask for advice from a life insurance professional. The person is also advised to compare several policies before settling for the one he/she thinks is the best.
Myths and facts
Several myths associate with life policies including:
Life policy is expensive – Life Insurance Tips And Facts
Many people shy away from buying a policy because they say it’s pricey. A life policy is not as expensive as many people believe it to be.
Only adults should buy a life policy
Some people believe that only adults should buy a life policy. Contrary to the popular belief, it is cheaper to buy a policy at a younger age.
Bad health disqualifies people from buying a life policy
Some think that people who are not healthy cannot buy a life policy. It’s not true. They can buy a policy, but it may be expensive.
Not everyone should buy a life policy
Some people believe that only a breadwinner should buy a life policy. Even the people who do not work need a life policy to remove a burden on the breadwinner in case one of them dies.
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All info was correct at time of publishing