Life Insurance in Dubai-Dos and Don’ts to be Followed
UAE a hub of diverse cultural background and values hold a certain criterion for its citizen safety rights and by law compel individual to have specific obligated insurance as soon as possible when they get elected.
But talking about life insurance which is as important than any other insurance need to get more recognition and importance especially in time of uncertainty and unfortunate situations.
Being a responsible person in your family, then ensuring family finances but what if something happens to you then who will look after your family?
For this purpose, life insurance policy makes sure that your family is secured enough for a time being that helps them to get settle down.
According to sources, 50 percent of the UAE audience are not adequately aware of the importance of life insurance and still are not registered to get the policy.
Therefore, to acknowledge the life insurance importance of the government and many insurance providers are coming forward and presenting the affordable packages along with maximum coverage against serious illness like cancer, etc.
To understand who life insurance can be avail at affordable rates we have mentioned the dos and don’ts to get the real picture behind its policy.
Dos of Life
1. Prime Life Insurance Plans
There is a different type of life insurance available to your suit where each has different monthly premium charges of your need.
- Level Term
The life insurance provider gives coverage of lumpsum payment when the holder/ Client dies during the term period/payment.
It should be noted premium is fixed and it’s not expensive as compare to whole insurance.
2. Whole of Life Term
You pay out the lump sum amount whenever you die. The set date for premium is up to the age of 95-year-old.
3. Decreasing Term
This policy replicates level term policy to some extent as it provides lumpsum money when the holder dies during the term payment but here lumpsum price decreases with the maturity of the policy and thus considered very cheaper than other coverage plans.
Therefore, the citizen of
the UAE including the expats too have the flexibility to pick the right plan
2. Create A link between Life Insurance and Mortgage
Life is very unpredictable and in order to be ready and protective against such unpredictable not only for yourself but also for your family you need to seek the best possibility avail to you in terms of life insurance policies.
- Now you can also have life insurance and mortgage package in one policy
- Where you will secure your family with the payment of the mortgage in the event of your death.
- A decreasing term policy is considered to be the best option for you if you have standard mortgage repayment.
- Like the outstanding balance on your mortgage, this policy also reduces the lumpsum amou8nt over time.
- Similarly, also with the level term, the lump sum pay-out does not diminish over the interval.
So the policy makes sense for those with an interest-only contract, whose profit has not decreased the mortgage lump sum owed and will, therefore, need, in the event of the loss of the provider, a lump sum.
3. See What You Are eligible for
Seek different possibilities and get aware of the things you might owe during your insurance coverage.
- You might be eligible for death in service cover from your company or employer you are working with.
- This option might contribute almost 4 times your salary but depend upon your requirement you can make some modifications to your projected coverage plan.
Hence you can save more money and will have less premium payment.
4. Use Waiver of premium
The best way to make your insurance policy more secure is by using a waiver of premium.
- You can simply add any clause in your insurance policy stating that you will get coverage in the time of need like in an accident or sickness you have an inability to pay the premium.
Therefore, be sure about your insurance policy and seek
its useful forms.
5. Evaluate between Single Vs Joint Life Insurance
The decision between single vs joint life insurance is to get the maximum benefit from any of the policy your select.
- In case of having joint life insurance, you and your partner might be covered in a reasonable premium and discounts.
- but the payment so made only once yet if one of the other partners dies the other is left with no future coverage.
- Single life insurance policies can cost you more but if you can get a more flexible and customized coverage plan.
Therefore, listen to expert advice and evaluate your choices wisely.
Don’ts of Life Insurance
1. Don’t Miss Any Essential Coverage Plan
Coverage plans are the main foundation of any insurance policy.
- Your lack of interest or value towards the essential coverage plans then you are making the biggest error that has an adverse effect on your financial and physical health.
- By coverage, we meant the protection payment you give to provide basic compensation to your dependent or to you in some serious situations.
analyzing the process of coverage, financial or insurance experts are always
giving hints and tactics to identify the best deal for yourself.
2. Don’t do the Smoking
As much as this sounds weird or unusual but this plays a very influential role in setting your premium.
If you are a smoker of any kind let says vaping, e-cigarettes and cigars can directly double your life insurance premium due to high risk associated with your health
restraining yourself for 12 months smoking free you can get reasonable premium
3. Don’t hide any critical illness
Life insurance’s main purpose is to safeguard you against all odds.
Therefore, don’t hide any critical illness you might be involved or your family medical history is familiar with such illnesses like cardiac issues, cancer, strokes.
You might get better deals if you get a critical illness policy in your current insurance rather than buying independently.
But it’s very important y0u compare this policy with the other income protection insurance charges so that you don’t get any surprise high premium.
4. Don’t Forget Inheritance Tax
Your life insurance provider might want to write your insurance policy in trust.
The purpose is to highlight that in the event of your death your policy has no part in your estate, therefore, it avoids inheritance tax.
5. Don’t Avoid the Annual Insurance Comparison
Like any insurance, you must review your annual life insurance to know more about the changes in your premium or terms and condition before and after the first year.
It’s essential for you to get a real picture of your policies and how it makes a difference in your life.
Therefore, avoiding annual insurance reviews can be very risky and unwise.
The misconception behind life insurance that they tend to be very expensive is just creating more cloud of confusion and nothing else.
We always try to present the real facts and think out of the box to give you an alternative and best deal for this important insurance.
Hence, explore more and
Originally published Dec 07, 2019 12:04:49 PM, updated May 12, 2021