Many consider term insurance to be expensive. Even when most of us know the importance of having a term plan, a lot of us have not bought one yet because of the myths associated with it. 

Even though the term insurance has been gaining popularity, the misconceptions surrounding term insurance are many. Let’s try to debunk some of the common myths around term insurance.

1) You don’t need insurance at a young age

A lot of people have the belief that insurance is for older people. However, that is untrue. In fact, having term insurance from a young age can help leverage lower premiums prices as term insurance premiums increase with age. As you age, the risk associated with your health increases and your insurance premium will also increase. 

According to a term insurance premium calculator, if you are 25, coverage of Rs.1 crore till the age of 60 will cost you at least Rs.600 per month. But the same plan will cost you at least Rs.830 per month if you are 35 years old.

Term insurances might require medical check-ups as well. At a younger age, you are less prone to diseases and that too can positively affect the premium prices. 

2) Term insurance isn’t mandatory if you are healthy 

If the recent void-19 outbreak has taught us anything, it is that life could get unpredictable. You do not want to leave your family stranded if anything unfortunate happens to you. The major purpose of taking a term insurance policy is to remain prepared to support the family in case of any such unfortunate event. It will make sure your family is financially protected even at the worst of times and you will get the peace of mind you deserve. 

3) Most claims are rejected

There is a common misconception that most term insurance policy claims are rejected. However, as per Insurance Regulatory and Development Authority of India, insurance companies’ average death claim settlement ratio falls between 85%-99%. That means, out of every 100 policies, a maximum of 15 might get rejected, which is not a significant rate.

You can also make use of the information available at the Insurance Regulatory and Development Authority of India (IRDAI) website to compare the ratio of claims and settlements of every major insurer and choose one accordingly. 

4) The process of buying term insurance is lengthy and tiring

A lot of people hesitate to buy term insurance thinking the process of buying a term plan is lengthy. The offline process with a series of forms and documents could get tiring. However, today most of the processes are online and the process is completely hassle-free.

The chronology might differ from provider to provider, but here are the common steps.

  • Go to an insurance provider or broker website of your choice
  • Register with the basic details
  • Choose a plan
  • Do a KYC
  • Provide the medical details required
  • And pay!

It’s that easy nowadays!

5) Term Insurance are costly

This is the most common myth associated with term insurance and it has no truth at all. In fact, term insurance is considered to be the most affordable insurance policy out there. They offer high coverage for low premium rates when compared to the other life insurances even. This is because, unlike with a regular life insurance policy, there is no investment associated with a term plan. The insurance will get lapsed if the policyholder survives the term and there will be no refund. You can leverage this to protect your family with a higher coverage with a lower sum. 

6) The insurance cover cannot be altered

Another common belief surrounding the term insurance is its robust structure and uneasiness in changing the policy. But insurance providers understand that as life goes on, your responsibilities and financial status could also change.  That is why with most term plans, you have the option to increase your life cover after certain years to meet the changing economic needs. 


Term insurance policies are essential in the protection of your family, doesn’t matter your age, family, and financial status. More than anything, it gives you the peace of mind that you deserve the most.