Most people often hesitate to think before participating in life insurance because they think that money put in here is “lost”, is “capital loss”. Because the main function of life insurance is still a solution to protect and secure financial support when facing risks in life.
However, let’s listen to 4 insurance buying tips that Ms. Tran Huyen (born in 1990) who is currently an Insurance and Financial Consultant for Manulife Vietnam Co., Ltd. will share to help you “not be afraid of capital loss”. .
Tip 1: Buy insurance when you are young and healthy
Age 20 or 30, you have good health, low risk of death, so insurance premiums are low. So, to take advantage of this provision, you should consider investing in life insurance early.
Not to mention, when buying a life insurance plan at a young age, your money has a longer time to return. Therefore, the maturity benefit that can be received at the end of the contract’s life is also greater.
If you buy a life insurance plan at age 25 and continue paying premiums until you turn 60, the money has 35 years to accumulate into retirement.
If you buy at the age of 40, you only have 20 years, so the accumulated amount will be less. Investing early can increase the cash value of the investment in the long run.
Tip 2: You should not combine too many people into the same insurance policy
Many people often think that putting all members of the family into one life insurance policy is optimal and beneficial, but the reality is the opposite.
In a policy, only 1 person is insured for the main product, the remaining insurers are secondary and only participate in the supplementary product. The more people you add, the more add-ons, and it is this supplement that will reduce the accumulated amount.
So for the best, a life insurance policy should only have 1 insured person, or only include 1-2 extras who are small children, the complementary products are just enough, accounting for about 30%. The total contract fee is the most reasonable.
Tip 3: Choose an investment-linked insurance product
Investment-linked insurance is a type of life insurance aimed at insuring participants against risks, and at the same time combining investment elements to increase assets in the future.
As such, this is not a purely investment-oriented channel but a combination of investment protection insurance. The premium paid by the participant is divided into two parts including the insurance part and the investment part. The amount you put in every year, after deducting the prescribed fees, the remaining amount will be invested in fund certificates.
“Currently, according to the annual report, the average annual rate of return of funds such as Growth funds and Development funds is 15-18%/year.“, Huyen shared.
However, in investment, it is obvious that the higher the interest rate, the higher the risk, so you need to consider your risk tolerance, as well as ask your advisor for advice carefully. funds to be able to choose suitable funds.
Tip 4: Get involved for the long term
Join life insurance in the early years, minus fees and policy cancellation fees are very high, up to 100%. If you stop participating in the first 2 years, you will not receive any refund. Even in those two years, you have paid regular premiums and have not changed the insurance amount.
If you cancel your contract after two years of joining, you may get a full refund. However, the amount may be lower than the previous fee. The reason is that right from the time the contract comes into effect, the insurance company has deducted the related operating costs.
The later, the lower the deduction fee, the higher the amount accumulated and profitable. Therefore, the trick to not losing capital when buying life insurance is to participate for the long term.
The article is written according to the advice of an insurance consultant.
at Blogtuan.info – Source: Afamily.vn – Read the original article here