With an insurance policy, specifically, life insurance, you can achieve many objectives, including financial security for your family and retirement savings for yourself. Therefore, seriously consider the matter of selecting a financial product such as life insurance. Here are some insurance mistakes that you need to avoid at all costs.

1. Delaying Your Decision:Deferring your decision on buying life insurance is a crucial mistake that can reduce your chances of availing maximum policy benefits. In general, the rule of thumb is that the best time to buy insurance is while you're young because the premiums will be low, and everything else will remain constant. As your age advances, the risk of life aggravates, which, in turn, increases the premium you must pay. Therefore, life insurance policy purchased at a younger age offers you enhanced coverage for a longer duration by paying the lowest possible premium. By starting early, you can also achieve your future financial goals with systematic premium payouts towards the life insurance policy.
2. Avoiding Research on Various Life Insurance Products:Before selecting a life cover, you must make yourself aware of the various life insurance products that are available in the market. For instance, a term plan provides you pure protection from death risk only. With this insurance plan, you can avail a significant amount of coverage for a low premium. However, there are no maturity benefits under term insurance.In ULIP, on the other hand, your investment is linked to financial instruments. A part of the premium paid gets invested in financial markets while the remaining portion is used to provide life cover. You can choose to invest in equity, debt, or a combination of both funds as per your risk appetite and goals. ULIPs can help you in achieving long-term financial goals such as saving for your childÂ’s higher education or wedding. Therefore, by knowing about the different life insurance offerings, you can make an informed decision about where to invest your money.
3. Overlooking the Claim Settlement Ratio:The claim settlement ratio or CSR is an important factor that can help you understand whether the insurance company is reliable regarding settling their claims. The rule of thumb says that you should always go with an insurer that has a healthy claim settlement ratio. You will be at peace, knowing that your loved ones will receive the claim amount without any hassles when you wonÂ’t be around.Claim settlement ratio also helps in analyzing the overall performance of the insurance company. That said, most insurers offer a free-look period of 15 or 30 days after purchasing a life insurance plan. You should utilize this period to go through the policy terms thoroughly, and if you donÂ’t find the plan suitable to your risk appetite or expectations, you can always return the same.
4. Being Unsure About the Premium Paying Term:Every insurance plan requires the insured to pay a premium amount to the insurers on a regular basis. It is important that you check the premium amount and payment schedule for your plan before opting for it. Different policies have different premium paying terms, depending on the kind of plan (whole life, term, or ULIP) you have chosen. The premium also depends on your age, profession, and some other factors.You should be aware of the premium paying term (PPT) for your policy as it will help you to calculate how much you will be paying for the insurance plan over the years and the expected return on that policy. Knowing about the premium payment term can also help you to assess your long-term budget requirements. To know about your specific premium for Generali CentralÂ’s plans, check the Premium Calculator on our website.
5. Failure to Calculate the Appropriate Insurance Cover:The purpose of purchasing life insurance is defeated if the policy doesnÂ’t fulfill your familyÂ’s actual requirements when needed. Therefore, blindly buying any life cover would be a terrible mistake. Imagine a scenario where your family makes an insurance claim after your death, but the received amount is inadequate in fulfilling their financial requirements.Therefore, to avoid any such situation, you must first calculate an appropriate insurance cover by considering financial liabilities such as your childrenÂ’s education and wedding costs, monthly household expenses, and your parentÂ’s needs. The best way to understand the coverage your family needs is to talk to a financial advisor. For more information on the plan and cover that works for you, talk to our trusted and experienced advisors .

Buying a life insurance policy is perhaps the most crucial financial decision that you make in your lifetime. Thus, itÂ’s important that you donÂ’t make these costly mistakes which can increase your premium amount or leave your family bereft in the time of need. Take some time to understand the requirements of the policy: its term, premium, insurance cover, and also see which policy effectively secures your loved ones in your absence.