And Save Yourself Years of Regret
In India, insurance often enters our lives the wrong way — not through education, but through urgency, emotion, or a friend who just became an agent.
And that’s where the traps begin.
Not all bad insurance decisions are scams. Sometimes, they’re just honest mistakes — the kind that cost you lakhs, offer poor coverage, and leave your family exposed when it matters most.
Let’s break down the 3 most common insurance traps that millions of Indians fall into — and how to dodge them smartly.
Trap 1: “You’ll Get Your Money Back — Plus Insurance!”
This pitch feels like a jackpot:
“Sir, you’ll get full protection AND all your money back after 15 or 20 years!”
Here’s the truth: these are endowment or ULIP plans — insurance + investment bundled together.
What they don’t tell you:
- You’re often covered for only ₹5–₹10 lakh
- You pay high premiums and get low returns (often less than 5%)
- You lose flexibility — neither great savings, nor strong protection
If your goal is to protect your family in case something happens to you — then a simple term plan for ₹50 lakh or ₹1 crore will do that 10x better, and at 1/10th the cost.
Insurance is not a place to earn returns. It’s a safety net. Want returns? Choose mutual funds or PPF. Want peace of mind? Choose term insurance.
Trap 2: “Limited Offer! Sign Before It Closes!”
You’ve probably heard this:
“This scheme is closing this month!”
“Only 200 policies left!”
“You’ll miss eligibility if you don’t sign today!”
Sounds urgent. Sounds scary. But it’s pure pressure marketing.
Here’s the fact: All IRDAI-approved insurance products are available all year round.
No legit term plan or endowment policy vanishes overnight.
And if it’s a government-backed scheme like PMJJBY or PMSBY — you can walk into a bank next month and still apply.
If someone’s rushing you — take a step back.
The right policy will still be there tomorrow. Your peace of mind matters more than their commission.
Trap 3: “Sir, You’re Too Young for Term Insurance”
This one’s subtle — and dangerous.
“You’re just 35. Why throw money away on term insurance?”
“Better buy a plan where you’ll get something back later.”
Here’s the thing:
Term insurance isn’t about age. It’s about responsibility.
If someone depends on your income — your spouse, your kids, your parents — you need life cover.
And term plans are the most cost-effective way to get it:
- ₹50 lakh cover = Around ₹400–₹500/month
- ₹1 crore cover = Around ₹700–₹1,000/month
- Zero returns — but total security
This is the plan agents rarely promote — because they earn less from it.
But you gain clarity, confidence, and real coverage.
When your family needs it most, they won’t be asking about returns.
They’ll need support — and term insurance delivers that.
Final Thought: The Best Insurance Is the One You Understand
If you can’t explain your policy in simple words to your spouse, your parents, or even your teenage child — don’t sign it.
- Don’t fall for emotional sugarcoating
- Don’t rush because someone says “limited period only”
- Don’t avoid term insurance because “it gives nothing back”
What it gives back is stability when everything else falls apart.
Check My Best Plan — Compare transparent, simple insurance options that protect your family, not your agent’s commission.
