Availing insurance is a major part of financial planning. It is compulsory to avail insurance, if you are the breadwinner of the family. People these days have understood the value of life insurance and many are coming forward to avail insurance plans, to protect loved ones.
As people availing insurance increases each day, insurance agents are also increasing. An insurance agent is a person who helps avail insurance plans. The sad part is not all insurance agents help meet financial goals or needs. This is mainly because insurance agents work for a commission and most of the agents try to sell life insurance policies which give them a high commission. In this blog, we will discuss how your insurance agents may cheat you.
If you are not happy with the life insurance policy availed, you will be allowed to return it within 15 days of receiving the policy documents. This 15 day period is called the free-look period. After returning the policy you will get a refund after deducting certain charges. But unfortunately, most of the time, insurance agents do not inform policyholders regarding the free-look period.
Insurers provide you with an option to buy insurance policies online. Availing insurance policies online helps reduce the costs involved as there will be no insurance agent involved in the process. But, insurance agents will not inform you on the online facility available to buy insurance policies. If asked, they will say it is costly when compared to an offline purchase.
If you are planning to avail life insurance, insurance agents force you to avail endowment plans. They try to convince you saying this policy offers good bonuses and a high maturity amount, if you survive the term of the plan. Insurance agents do this because they get a high commission on the premiums paid by you on the endowment plan.
If you want to buy an insurance policy to protect your loved ones in your absence, endowment plan is not the right choice as it offers low mortality cover. Endowment plan is a savings cum insurance plan which comes with a high premium.
Most of the insurance agents do not consider your needs while selling the policies. They just think of their own commissions. For instance, many agents do not inform you on the term life insurance policy as it offers a low commission. If you are planning to protect loved ones in your absence, term life insurance is the best option available. Term life insurance provides maximum risk cover for a minimum amount of premium.
You may be forced by insurance agents to avail life insurance plans with a high sum assured. This is mainly because they get high commissions. But, you have to pay high premiums for such policies. After some time you might find it difficult to pay high premiums. So, before availing a life insurance plan you should identify your needs and buy according to them.