Life insurance can protect your family and loved ones if you die uncertainly due to certain reasons. It is the insurance money that can help your family to recover from the life and to continue the life even after your death.
The advantages and disadvantages of life insurance are given below to know the real facts.
Life insurance can cover all risks you are facing regarding your children’s education, financial support to your family after your death. In case if you die earlier with your term life insurance, your family can recover the financial loss from your death benefit, providing your family with a lot of money that will be sufficient for them to survive. Your loved ones do not have to depend on anyone or to take loans from the bank for living life, your life insurance money will be reasonable and enough for them. Buying life insurance is one of the cheapest and tax-free ways to protect your family, promising them a prospering life in the future.
2.Savings with endowment plans:
There are different types of life insurance that include children life insurance plan, retirement plans, term plan and endowment plan that helps in saving your money with your insurance plan. Your money is invested in different businesses and you can receive a dividend amount annually from the insurance companies. This type of life insurance can benefit you as your savings can turn into a bonus(interest) into your existing life insurance premium. This insurance plan is best for you as it can pay you dividend money just like any other investment company.
Buying life insurance can help you to secure the financial needs of your family. The life insurance premium costs lesser every month if you buy it at an early age. Your family will receive a tax-free amount after your death, there will be no unnecessary deductions. The tax benefits you will receive depends on your income tax rules. The insurance will be more than enough for your family to recover from the loss. So these tax-free insurance plans are the immediate and best way to protect your family when you die.
Although life insurance has many advantages it does have some disadvantages.
Life insurance can benefit you in many ways but the endowment plan pays you an annual dividend and cash value but it is not always promised, some insurance have huge businesses which affect the cash value of every consumer. If you want to surrender the policy, to save your insurance money, then insurance companies provide very small money in return. This makes it less reliable and riskier than other investment companies and the stock market that are more beneficial under these circumstances.
Expensive for unhealthy persons:
The insurance premium amount for youngers is much lesser than elder people. Because the premium amount is decided based on your health medical reports, gender, and age. So if you are already in your 50’s or 60’s your death rate will be higher, you will gave a lot of health issues, long life is not guaranteed so insurance companies will charge more money from you. The more fatal and life-threatening diseases you have, the more life insurance will be expensive for you and difficult to afford.
Can mislead if not understood properly:
Most people went for their insurance without reading the terms and regulation document, they agreed to them even not reading it once. this can be dangerous for you because many insurance companies can manipulate you with false rules and regulations. The claim rate of most insurance companies is different and sometimes they deny to pay the money as they promised due to a lack of understanding and regulation policy.