Term Insurance
Last month I met a relative in a tier 2 city. Her husband had met an untimely death. She has 2 school going kids. The family depended on Husband’s earnings. To make the matter worse, her husband had taken a Home loan and they have almost completed house construction.
During discussion she showed me the papers related to Home loan. I was expecting bank has provided term insurance to cover the loan. To my sadness, I did not notice any transactions related to terms insurance. He had taken couple of LIC policies amounting to risk cover of 2 lakh.
She asked me, can she fight with bank for not giving insurance before sanctioning the loan. I didn’t have any words. Felt really sad.
There was a big gap to be filled to repay Home loan and children education. It will be Hercules task for her.
No emotional support and suddenly enormous responsibility.
It is a big problem in tier 2 cities and small towns and even cities like Bangalore. People do not understand how important it is to have a cover that will at least meet the liabilities till the age of sixty. Specifically if a sole bread earner, I will say it is the basic minimum part of our financial plan.
“Term insurance will not give any profit after maturity” is such a poor justification for not having one.
Well…lot of people find it hard to understand concept of insurance. If you see anyone getting into huge liability and is a sole bread earner, please educate them.