Advantages and Disadvantages of Life Insurance


Life insurance is a financial instrument that helps the individuals for the financial stability in their absence. For example, if you have a life insurance then in your absent it supports your family by giving your death benefits to your family members. We know that there is no rose without thrones like that the life insurance has its own advantages and disadvantages. Let’s talk about these matters individually.

Advantages of Life Insurance

  • Life insurance makes the habit of saving. It is a compulsion to pay the premium every year/ half or the year depending upon the companies which make the habit of saving.
  • If the insured’s meet the death it helps the family from the financial crisis by providing them the death benefits.
  • Life insurance is just like the pension. Pay when you are able and utilize when you are old or unable to work.
  • If you have a live insurance you can get loans at low rates. (Most of the companies pay 75% of the amount that you had paid as premium).
  • Life insurance amount is normally tax-free.
  • If you have bought the life insurance for your children, you are the spouse of your children in the policy and you meet to the death. The life insurance companies let the children skip to their premium or they no need to pay the further premium due to the absent of the sponsor.

Disadvantages of Life Insurance

  • Normally the insurance policy is of 10- 20 years. So you must have to wait 10/20 years to get the premium amounts.
  • After purchasing the life insurance you are paying the premium it is not guaranteed that you can utilize it because life is in certain.
  • Normally we depend upon the insurance agents about the insurance policy, sometimes they may not pay the premium and we may face the problems.
  • Low interest in premium.
  • You pay the premium for 20 years (if you are bought the policy for 20 years) if inflation decreases the value of money than it is worthless to sign the insurance policy form.

It is always recommended to read the policy before submitting the form. If you have not understands the matter you can talk to the agents. All the matters have the dark side as the life insurance also has. Life insurance is saving rather than the expense. You can get more benefits buying the insurance policy. Insurance your life and be secure from the financial crisis.


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