Buying life insurance
May 12, 2023
DD Planet
Purchasing life insurance becomes a need at some point of time. Once we have decided to go ahead, we get flooded with various offers in the market and thus, information and knowledge is required to buy a suitable life policy.
Here are the tips to help you on making a decision in this regard:
- Purchase a life insurance product only when you have dependents to support.
- Always remember that term insurance is the cheapest insurance product in the market and unless you are bothered about losing some money every year, you should purchase a term insurance only.
- Do not buy insurance unnecessarily. Your insurance needs will keep on reducing as you age and rise in your career. Once you have accumulated a good financial corpus, your need reduces. Therefore, buy a policy that offers reduction in sum assurance with increase in your age.
- Do not prefer to buy a policy for a hundred years when the average age in India is about seventy-five only. There is no point in paying extra premium and that too for a longer duration.
- If you are considering a life insurance product for investment as well, choose a policy that offers you less sum insured and competitive return guarantee. For a detailed insight into investments, you may consider reading the book ‘Sack Me If you Wish’ by Devinder Dhingra.
- Do not buy insurance just for saving taxes. Buy only that much of what you actually need. You can always save taxes by investing in better investment products other than insurance.
