Myth & Facts About Insurance Policy

Insurance is considered as one of the best tax saving options and thus in most of the cases, the policies do not cover enough for you and your family. However, insurance used for tax saving purposes is completely a myth. It is advised to view and understand each term and condition before choosing any particular Insurance Policy. Many people believe that Life Insurances are too complex or unnecessary. But Life Insurance can become one of the best life saver at the time of emergency. However, the question arises how to choose correct life insurance for yourself. In this blog we will discuss all the types of Insurance and what are its myths and facts.

Types of Insurance

Each Insurance Policy is prepared for a specific purpose. It is better to understand which Insurance is the most suited for you. Here is the list of multiple types of Insurance given below:

Health Insurance: Health Insurance commonly known as Medical Insurance is a legal entitlement to payment for your medical or health care cost. Different Health Insurance packages cover different diseases and cost of reimbursement. It mainly provides financial cover for your medical treatment expenses.

Life Insurance: Life Insurance is one of the important insurance used for family member’s security. It is a contract between policyholder and Insurance Company, where Insurance company promises to pay a designated amount or money upon the death of the policyholder. This amount can be transferred within a certain time period to the nominee (family member/friends/relatives) as per the contract.

Home/Shop Insurance: Property Insurance includes the insurance of any property including home, shop or any other property. It provides a financial reimbursement to the owner of the property in case of any damage such as theft, fire, etc.

Car Insurance: Auto Insurance or Car Insurance is a contract that protects you against financial loss in the event of an accident or theft via car or any vehicle.

Travel Insurance: Travel Insurance is a financial protection plan that covers unexpected losses while travelling. This travel Insurance is provided by multiple companies while booking travel tickets or packages as well.

Myths & Facts About Insurance Policy

Insurance is considered as the important financial support at the time of emergency. However, there are some myths about Insurance Policies, let’s discuss these myths and facts about Insurance Policy:

Insurance can be used for Tax Saving Purpose: It is believed that insurance is one of the ways to save tax, however, the fact is it provides protection to you, your family and your assets.

Insurance will benefit only after the death: One another myth is Insurance will help the family members of the policyholder after his/her death. But the fact is Insurance can be used to provide yourself a comfortable lifestyle after your retirement.

Only the Jobholder of the family needs Insurance: It is believed by many individuals that only the jobholder of the family needs insurance but the fact is every family member’s insurance is equally important to the insurance of the jobholder of the family.

Individuals having no Dependent do not need Insurance: People usually believe if they do not have any family, relative or dependent then the insurance is completely a waste for them but the fact is Individuals having no dependents must obtain Insurance for themselves. In case of any mishappening this insurance can be used to repay the hospital bill amount.

Young & Healthy People do not need Insurance: There is one another myth that the young or healthy people do not need insurance and only old aged people need insurance but it is completely a myth as Insurance is equally important for Young & Healthy People as for Old aged People.

Once bought, Insurance Policy cannot be changed: People feel once they bought any insurance policy then they can not change it. However, there are multiple schemes and policies available in the market which can be modified or updated even after a week, month or year of purchase. It totally depends on the terms & condition of the Insurance Policy.

Distinguish Myths from Facts

It is very important to distinguish all these myths from facts not only while applying for Insurance but also for the knowledge of the individual. Here are some of the ways to distinguish myths from facts:

Well Research: One of the best ways to distinguish myth from facts is to have enough knowledge through research. Always look for trustworthy and unbiased information from a well known insurance company.
Review Policy: It is always better to review your policy before making a decision. Each term & condition of the policy must be read thoroughly for getting better understanding related to Insurance Policy.
Cross Questions: It is recommended to clear all your doubts before making a purchase of any random Insurance Policy. If you have any doubt or unsure about any point of the scheme just clarify your concern. It is better to ask again then opting for the wrong Insurance Policy which can create problems for you in near future.

Conclusion

Insurance Policy provides financial help to any individual at the time of financial needs. There are multiple types of insurance such as Health insurance, Life Insurance, Property Insurance, Car Insurance, etc. There are always some myths about the insurance policies that they are used only for the purpose of tax savings or it is made up for old age people or they can provide benefits to family members only and not the policyholder.

But the fact is Insurance is used to provide financial protection to an individual, it is made for young & healthy people as well, it not only provides benefits to family members but also for the policyholder or the jobholder of the family. There are multiple myths and facts about insurance policies. It is advised to do proper research before purchasing any random Insurance Policy.

Frequently Asked Question (FAQs)

Is it really good to have insurance?

Yes, it is advised to have insurance as it is a financial safety which can help you financially in any emergency such as medical issue, theft or fire, lawsuit or car accident, etc.

Can I buy two life insurance policies?

Yes, individuals can buy two life insurance policies at one time as there are no such restrictions.

Is life insurance only for older people?

No, life insurance is beneficial for everyone. Buying it at a younger age results in lower premiums and better coverage.

Does health insurance cover all medical expenses?

No, Health Insurance does not cover all medical expenses there are some diseases which are not covered under Health Insurance Policies.