3 Mistakes To Avoid When Buying Your Very First Insurance Plan
Entering adulthood can be a fun and exciting time. You experience many things in life for the first time – financial independence, a chance to explore the world on your own, and the ability to make your own decisions. Adulthood is also accompanied by responsibilities. Till date, your parents probably handled everything for you, including your finances. As you take your first steps towards adulthood, you might start handling money matters of your own. This would include buying your own insurance coverage as well.
At this point, the only coverage you may have is your health insurance through MediShield Life which you enjoy as a Singaporean citizen. However, you need much more coverage than that. You might want to upgrade your medical coverage to an Integrated Shield Plan so that you can get the best healthcare when you need it,protect your loved ones’ future by taking a life insurance plan for yourself, and perhaps even look into insurance savings plans to grow your money.
Getting all that coverage at one go can be pretty overwhelming, especially if you are new to insurance as a whole.
But don’t worry, we have got you covered! In this article,we have listed down 3 major mistakes you need to avoid while buying insurance.
Mistake #1 – Buying the same insurance plan your friend did
What you should do – It is extremely essential to do your own research when buying an insurance plan. Simply selecting a plan because your friend did so might leave you either underinsured or paying for more coverage than you need. Whether you are buying life insurance or health insurance, always do your own research and select the cover limit and premiums that suit you. For instance, your friend might have taken a term life insurance plan to cover their home mortgage for a few years; however, you may benefit more from whole life insurance as you want a plan that covers you for life. Plus, bear in mind that your friend’s budget for premiums may not match yours.
Mistake #2 –Forgetting to read the plan details
What you should do –Okay, so you have found an insurance plan with the cover limit you want and the premium suits your budget. You are about to sign up for coverage. But wait! You must ensure that you read the fine print before you buy the plan. For instance, if you are buying critical illness insurance, you might want to check the plan’s waiting period and survival period for future reference. This will save you from any surprises if and when you do raise a claim. If you have any queries about something you have read, clarify them with the insurer before going ahead with getting the coverage.
Mistake #3 – Not taking the help of a financial consultant
What you should do –Since you are buying insurance for the first time, you might require some guidance. You can always consider talking to a financial consultant for advice in selecting a plan that suits you. A good financial consultant will help you better understand your needs and explore the various insurance plans available and offer guidance in selecting the right coverage and riders as per your requirements.
Do avoid these mistakes so that you can make better decisions when you buy insurance for the first time. Remember to always keep your coverage active to stay protected against the many uncertainties of life. Good luck!