From my decades of professional experience, I came across people having insurance but no idea what type of insurance and for what reason. They told me they bought the insurance because of one or more of the following reasons. Here are some of them:
- Helping someone to achieve their quota.
I am just speechless on this point. Doing someone a favour once, then cancelling? Consider them not meeting their persistency ratio and also being penalised when they don’t hit their 2nd year’s quota? So are you helping them out or making the problem worse? - Because someone promised to give you a cut in commission.
Commissions are paid by the insurance company and the agent invests time and money to better themselves to service you. If they believe they don’t deserve the full commission (which is literally their salary), do you think they deserve to be your agent? If you have a claim, will they still be there for you? - Because one of your family members is an agent and he/she is telling you all the great things.
I love this one the most. I remember when I was 19 years old and had just started working. I was still living at home with my parents. Financially, I supported no one and didn’t have any financial dependents. I was only making around $100 a month but yet I was told I must buy insurance to financially protect my parents if something was to happen to me, leaving me unable to work. Why? Should it not have been the other way round? Another example was when my mum was recommended to buy a whole life insurance policy despite having already passed her retirement age and was nearly reaching the maximum entry age for insurance. Understand your needs before buying. - If someone else will cover your unforeseen costs.
But if your spouse is paying for you, can you guarantee that the same will continue for decades? What if the relationship went south and your spouse called it quits? I would still recommend that you have a contingency plan to properly protect yourself from the outset. - If you are already over-insured.
Remember insurance companies won’t pay out more than what the industry maximum but you’re always welcome to try. - If you plan to conceal any material facts or your decision not to tell the truth about your medical history.
Don’t worry I’ve got you covered. I can tell you that you’ll be the most likely to become part of the statistics as to why insurance companies don’t pay. Don’t conceal, insurance companies will always have a way to uncover them. - If you are considering how to benefit from it unethically.
Think again, insurance companies can uncover your wilful acts. - If you plan to travel to restricted or war zones.
Yes, this is very exciting but insurance companies are not worried as they simply put an exclusion clause. - If you are already retired and an empty nester.
No one is financially dependent on you and your passing has no financial impact on anyone.
These are just a few from me but the list goes on…….
