RESUME APPLICATION PAY PREMIUM
Fund Performance

Fund Performance

Knowledge Center

Knowledge Center

About Us

About Us

Tools and Calculators

Tools & Calculators

Quick links

Mobile (Download app)
  • Webpages
  • Documents
  • HDFC Life ClassicAssure PlusInvestment
  • HDFC Life ClassicAssure PlusInvestment
  • HDFC Life ClassicAssure PlusInvestment

For NRI Customers

(To Buy a Policy)

(If you're our existing customer)

For Online Policy Purchase

(New and Ongoing Applications)

Branch Locator

For Existing Customers

(Issued Policy)

Fund Performance Check

RESUME APPLICATION PAY PREMIUM

What do you want to do?

Quick links

Mobile (Download app)

Download HDFC Life App

Buy plans, track your policy, make renewal payments & monitor fund performance with HDFC Life App, Download Now!

Apple Logo Go to Google Play Store

Why Most Indians End up Buying Insurance the Wrong Way?

down-arrow
Why Most Indians End up Buying Insurance the Wrong Way?
November 18, 2023

Table of Content

 

Just like a business or property, humans too are exposed to various kinds of risks. Insurance is a financial tool that helps to be prepared for losses caused by such risks.

Insurance plans offer security against various mishaps. It provides peace of mind knowing that your financial burdens will be taken care of, even in case of an unfortunate event. Investing in insurance plans generates financial resources and encourages saving habits. Premiums paid towards insurance policies also provide tax benefits. Due to such widespread advantages, individuals are now investing in insurance plans more than ever.

But, it is important to buy an insurance plan correctly. Let's find out how to do this.

How much should you be insured for?

It is imperative to determine the coverage you need. For this, you need to take numerous aspects into consideration. These include your income, the earnings of your family members, your assets, liabilities, and your current financial position, besides many other things. Ask yourself how much will your family need to meet their day-to-day expenses as well as fulfill other financial obligations when you are not around. The insurance plan you take should suffice their expenses and obligations.

For instance, your friend is deciding the amount of term insurance. Firstly, he needs to estimate his immediate needs such as medical expenses, debts, credit card payments, retirement needs, and emergency funds, besides others. He then needs to calculate his current assets, which include bank savings, investments, existing term insurance, and value of existing property. The difference between his family needs and his available assets is the amount of cover required.

While deciding the quantum of insurance required, consider your present age, too. Premiums payable are directly proportionate to your age. Another important aspect to consider is the level of inflation. You have to think about the future fall in the purchasing power of rupee. If the amount remains the same, it will not offset the fall in the purchasing power of rupee. Therefore, opt for an insurance plan providing a higher coverage.

Basic principle of buying insurance

Many make the mistake of buying insurance for the sole purpose of investment. The basic principle of insurance is to separate your investment needs and insurance needs. Buy term insurance, which is also known as pure insurance. Insurance agents promote other types of insurance stating that you get back the premiums paid along with a return. However, pure insurance plans come with their own set of benefits. They provide higher death benefits, which may be used to meet the financial needs of your near and dear ones. They also give you the peace of mind, knowing that your family's needs will be taken care of even in your absence.

If you are looking for the best term insurance plans in the market, consider policies offered by HDFC Life such as HDFC Life Click 2 Protect 3D Plus, HDFC Life Click 2 Protect Plus, and Click 2 Protect Health. Such pure insurance plans offer financial stability and complete protection to your loved ones even in your absence. Compare the features and benefits of these plans and buy the term life insurance plan best-suited to your needs.

Related Articles-  

ARN: ED/12/19/17049

Show Full Article
Hide Full Article

Term Plan Articles Term Plan Articles

Investment Articles Investment Articles

Savings Articles Savings Articles

Life Insurance Articles Life Insurance Articles

Tax Articles Tax Articles

Retirement Articles Retirement Articles

ULIP Articles ULIP Articles

Health Plans Articles Health Plans Articles

Child Plans Articles Child Plans Articles

Popular Calculators Popular Calculators

Francis Rodrigues Francis Rodrigues

Francis Rodrigues has a decade long experience in the insurance sector, and as SVP, E-Commerce and Digital Marketing, HDFC Life, manages the online sales channel, as well as digital and performance marketing. He has had hands-on experience in setting up sales channels and functional teams from scratch over a career spanning 2 decades.

LinkedIn profile
Author Profile Written By:
Vishal Subharwal Vishal Subharwal

Vishal Subharwal heads the Strategy, Marketing, E-Commerce, Digital Business & Sustainability initiatives at HDFC Life. He is responsible for crafting and ensuring successful implementation of the overall organisation strategy.

LinkedIn profile
Reviewed By Reviewed By:

Here's all you should know about life insurance.

We help you to make informed insurance decisions for a lifetime.

Why Is Insurance Necessary?

Why Is Insurance Necessary?

Learn the essentials of what is insurance, its types, benefits, and how it protects your finances. Get insights into life and general insurance policies today.

How to Take a Loan Against Life Insurance Policy?

Who is the Insurer and Insured?

Blue Chip Fund

"Blue chip fund invests in stocks / shares of well-established companies with credible financial performance, market capitalization & steady payout of dividends."

Blue Chip Fund
Why You Should Consider Buying Insurance Online Previous
Important Financial Steps to Take Before the End of the Year Next
HDFC life
HDFC life

HDFC Life

Reviewed by Life Insurance Experts

HDFC LIFE IS A TRUSTED LIFE INSURANCE PARTNER

We at HDFC Life are committed to offer innovative products and services that enable individuals live a ‘Life of Pride’. For over two decades we have been providing life insurance plans - protection, pension, savings, investment, annuity and health.

Popular Search

Popular Searches