Life Insurance – Most important yet most ignored

Life insurance is a very important topic as far as personal finance is concerned. I would say here that it is the most important part of an individual’s Financial Planning. In personal finance, we use to manage today about our (tomorrow’s) future financial needs, which itself a complete subject matter as part of the Financial Management.

Life Insurance, in practical, is a very ignored and unaddressed yet most important issue in human life. Apart from what personal finance management tells about the Life insurance, even in day to day life, we can feel it. Every second or minute of our life has a cost. This cost has to be borne by us by any means, no matter what our profession is or what our background is, if it is not generating enough money to manage the cost of every second or minute of life then our own existence has a big question mark and there is no need explain why?

Understanding Life Insurance

Generating income for today’s second and minute has always been a very favorite and hot topic in everyone’s life. People discuss a lot about generating income and style of spending of self and others. Endless discussions happen whenever people get an opportunity to talk about their spending habit on anything which can be done with small amount of money but how they have spent twice or thrice of that amount to show off their premium class. The most important point here is that others treat this type of people as a man of “attitude”. People have a tendency to get impressed and start copying them for their style of unplanned spending. We can experience this very well in any shopping mall, in shopping mall whoever comes shopping, end up spending more than that of their actual need just because of the carts of others are full and they feel inferior. People even feel bad coming out of a supermarket without shopping. Markets and showrooms have been designed in such a way that we end up spending even if we don’t need to purchase anything. People also flaunt their overspending habits as royal habits and the worst part, no one is there to make them realize that spending on unnecessary stuff today will lead to a difficult time for tomorrow.

I have many real-life experiences which are very appropriate to share here in this context. Once, I was attending the marriage of one of my cousins. All my relatives had gathered around for the ceremony. This is the time when everyone has the opportunity to showcase their pocket strength, ‘eliteness’, premium choices and recent purchases. I and some of my relatives whom I met after a long time were having chit-chats and discussing the current political and economic scenarios, eventually, we started discussing the scope of improving our own financial well-being. The moment I started discussing the risk factors of life and its management 75 % of us started looking into their phones, started calling someone, busy in clicking selfies and so on. In few minutes the gathering dispersed.

This was not the first and only occasion where people avoided the discussions related to future financial needs and how to provide for them. Every time if somebody somehow starts the discussion about the associated risk factors involved in future financial planning, he’s not very much welcomed and others think that this is a particular case with that person only and they themselves are not at all affected and there is no risk in their life. What I have analyzed as a reason for this is that many of them are not having an idea of managing the risks involved in their financial planning and particularly the risk of death which is the worst topic people prefer to hear and discuss. So, they tend to avoid these discussions. Taking all the instances of being avoided due to discussions involved with Risk of Death and their adverse impact on future financial planning, it can be said that the issue of management of Risk of Death is the most ‘unfavourite’ topic among the people will not be wrong.

Ensure you choose right Insurance plan while taking an insurance. You might end up choosing wrong Insurance.

People have a tendency to ignore the issues which they unlike and Life Insurance is one such topic which is on top of this list. However, the fact is completely different, imagine how many times you had a narrow escape from an accident which could have been a dangerous event of life your life leading to death and after your death all your dependent family members would have no option but to live a life full of miseries because every ‘second and minute’ of life has a cost and there must be a person who can provide for it.

There was a survey of joggers. Which says that most of the morning walkers in parks are already a diabetic, hypertensive or obese patient. The ratio of healthy walkers is very less. Healthy people do not care about the risks being diabetic or other health hazards.

A unique psychology is found in a human being to execute anything on the eleventh hour. However, there are few things which are irreversible. Like morning joggers have very rare chances of getting back to healthy life only by jogging. Whereas if you jog regularly you have very rare chance of having any kind disease or distress.

Securing your dependent family members for their financial needs of future is the most important objective of life. If you are earning and providing for everything to them today, but if you are not thinking about tomorrow then you are putting them all in a very risky situation. Because what you require to manage tomorrow can be done today only. You will not get a chance to manage it at the time when they need it.

Life insurance plans ensure better financial support for future. If you take a life insurance today you are protecting your dependent family members from financial problems even if something happens to you. Life Insurance plans to replace your income due to your death by the payment of Risk Coverage amount, this risk coverage amount is called Sum Assured. While taking Life insurance policies you should calculate that how much capital is needed to generate the interest income, suffice for your family members’ expenses. Please remember that no one on this earth can support your family through the life, whereas if you take a life insurance policy it will provide an amount which will be available to them like you. But the unfortunate part is that a Life insurance policy can be taken only when you are alive and not after your death. So, even if your friends and relatives are avoiding discussions on Life Insurances do not follow them, try to make them realize that life is full of uncertainties and you never know what is going to happen in next minutes. There is no guarantee that you will survive till the end and you will be there to help your family till the end. However, if you take life insurance plan you are assuring your family members that their financial health conditions will be very much sound for their entire life even if you are not there.

Happy Investing…

Thanks,

Anand Kumar
Insurance Expert