Even in 2025, many people hesitate to buy term insurance because of old myths and misconceptions.
Some think it’s "just for the old," others believe "you lose money if you survive." The truth? Term
insurance is the most powerful financial tool for protecting your family - simple, affordable, and
tax-efficient.
In this updated edition, we debunk the most common term plan myths and replace them with facts that every
modern buyer in Hyderabad, Telangana should know before making a decision.
Top Term Insurance Myths And Facts
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Myth: "Term insurance is a waste if I survive."
Fact: Term plans are like seat belts - you don’t buy them hoping to use them. They
protect your family from financial disaster. If you want refund, choose a Return-of-Premium (TROP) plan.
-
Myth: "I’m young; I don’t need it yet."
Fact: Buying early locks in low premiums for 30-40 years. Delaying 5 years can
raise your cost by 40-50%.
-
Myth: "Company insurance is enough."
Fact: Employer policies end when you switch jobs or retire. You need personal
coverage that stays with you for life.
-
Myth: "Term plans don’t cover accidents or illness."
Fact: They do. You can add Accidental Death and Critical Illness Riders for
complete protection.
-
Myth: "Claims rarely get paid."
Fact: IRDAI data shows India’s average claim settlement ratio is 96%+. Choose
insurers with CSR above 95% for peace of mind.
-
Myth: "I can skip medical tests to save time."
Fact: Skipping medicals means higher risk of claim rejection later. Always opt for
full medical underwriting.
-
Myth: "Homemakers don’t need life cover."
Fact: A homemaker’s contribution is irreplaceable. Joint or spouse plans offer
affordable coverage for non-working partners.
-
Myth: "Only men should buy term insurance."
Fact: Women actually get 5-10% lower premiums and should have their own independent
cover.
-
Myth: "Premiums increase every year."
Fact: Term plans have level premiums - once locked in, your rate
stays the same for
the entire term.
-
Myth: "Term insurance is only for debt protection."
Fact: It covers everything - education, household expenses, retirement support, and
legacy planning.
Bonus Myths Busted (2025 Updates)
| Myth |
Reality |
| Online plans aren’t safe. |
All online term plans are IRDAI-approved and 100% valid. |
| Claims take months. |
Digital claims now settle within 7-15 days. |
| You need big income to qualify. |
Even ₹3 L/year earners can buy basic term cover. |
| Once bought, can’t update. |
Nominee and rider updates available anytime. |
| You can’t buy after 50. |
Many plans allow entry up to 65 and cover till 99. |
Local Insights For Hyderabad
- Top 3 myths locally: term plans are waste, you don't need it young, company cover is
enough.
- % of buyers under 35 still believing term plans don’t pay: 32%.
- Avg. claim settlement time in Telangana: 14 days.
- Most popular insurer for young buyers: HDFC Life.
How To Buy Term Insurance The Right Way
- Disclose all medical and lifestyle facts.
- Compare CSR and premiums before buying.
- Add riders for accident and illness.
- Keep nominee details updated.
- Pay annually to save costs and avoid lapse.
Why Trust PolicyBachat
- Compare 20 + insurers instantly.
- Verified claim ratios and transparent pricing.
- Dedicated Claim Assist support for nominees.
- 100% paperless and IRDAI-registered.
FAQs
Are term plans really useful if I already have investments?
Yes - investments grow wealth; term insurance protects it.
Can I get money back from term plans?
Yes, choose TROP (Return of Premium) variants.
Is medical check-up mandatory?
For higher coverage - yes, and it’s beneficial.
How safe is buying online?
100% safe - same legal validity as offline.
Why are premiums different across insurers?
Each uses its own underwriting rules and risk models.
What if I lie to reduce premium?
Claim can be rejected for misrepresentation under Section 45.
Does claim fraud still happen?
Rare now - AI-based verification and Claim Assist reduce it drastically.
Which term plan is best for me?
Compare on PolicyBachat by age, income, and goals - it takes 2 minutes.
Can I increase my coverage later?
Yes, life-stage top-ups available.
Do women really pay less?
Yes - about 5-10% lower for same coverage.
Customer Reviews
- “Finally understand why term plans aren’t a waste.” - Rachita Mehta, Delhi
- “Loved the Myths vs Facts format - so clear.” - Anirudh Rao, Hyderabad
- “This guide changed my mind about term insurance.” - Sneha Pillai, Kochi
- “Now I trust buying online more.” - Vikram Nair, Bengaluru
- “PolicyBachat comparison tool sealed the deal.” - Priya Deshmukh, Mumbai
- “Perfect read for first-time buyers.” - Rahul Kumar, Pune
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