What Exactly Matters In Life Insurance?

There are things you must know

Life Insurance is a heavily mis-sold product. You must know what you are getting into.

1. Insurance is not an investment. It is a risk management tool.

You will be sold policies with a guarantee of return of premium. Insurance will be sold to you as an investment product or a tax saving tool. Insurance is just to mitigate your risks.

When you buy any insurance to protect your life, always go for pure term insurance.

2. Insurance is meant for protecting your life and providing for your dependents in case of your death. 

It is a risk mitigating tool for you and your family. In case of your untimely death, insurance proceeds will help your family to continue with their lives as usual.

3. Everyone doesn’t need life insurance

You need a life insurance policy only if you have dependents and if your corpus falls short of the required amounts to live a normal life. If you have enough money in the bank to sustain the lifestyle of your dependents without you, don’t buy a life insurance.

4. You don’t need insurance in retirement

What is the need to protect your life after you have retired? You have a retirement corpus. You do not have any dependents on you. Buy only when there is need.

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