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9 mistakes to avoid while buying life insurance plans:
- Buying guaranteed insurance plans: Such plans usually come with lower returns and hence you tend to lose in the long run.
- Buying in the name of minor: This for sure will reduce the premium but the entire objective of insurance would be defeated. Do not mix insurance and investments.
- Buying too many policies: This not only increases the administration burden on one, but even results into high administration charges getting paid to the insurers and their agents.
- Cheapest is the best: This is one big myth, study the intricacies in details before falling in this trap.
- Exiting the policy at the wrong time: Surrender costs should never be overlooked.
- I am young and I do not need insurance: We always think that bad things will only happen to others, this is not true and hence stay prepared for your loved ones.
- Life insurance is not a commodity: There is bound to be a mistake while buying a life insurance policy as it is not a commodity that can be bought off the shelf.
- Locking in a long term inflexible plan: Carefully study the terms of policy and do not lock yourself out in some inflexible plan.
- Not accepting the loading by the insurer: Accepting loaders can help you with smoother and more assured claim processing.