Sunday, February 24, 2013

Be sensible in covering your personal risks

Some insurance agents show statistics of the number of people dying through critical illness to scare you into spending a lot of money on critical illness insurance.

Consider the following points:

1. Everybody will eventually die from a illness in their old age (if they do not die earlier by accident).

2. Even after spending more than $100,000 on treatment, the chance of success is slim for an elderly person. Insurance is not intended to cover this type of costly futile treatment.

3. Insurance is to protect families when the dependents are young. After 25 years, the children have grown up and the breadwinner has accumulated sufficient savings.

4. If they do not spend $500 a month on a bad insurance product, they would have accumulated $500,000 at the end of 35 years by investing in the right product. They do not need insurance to pay their medical bills - they can use their savings.

5. Insurance agents are taught to tell lies and misleading statements to take away too much from consumers. The critical illness scare is just one more gimmick.

6. If you are afraid of critical illness when you are young, pay $120 a year to get $100,000 of critical illness cover. The chance of it happening is less than the chance of an accident. (The real cost is much less, but the insurance company wants to make a profit).

7. Here is how you can buy a good insurance package, covering death, accident an critical illness to cover a more adequate amount

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