choose-a-suitable-life-insurance-plan-not-the-cheapest

Choose a suitable life insurance plan, not the cheapest

Written by : Knowledge Centre Team

2026-01-07

882 Views

7 minutes read

Exit Pop Up

Introducing BSE 500 Enhanced Value 50 Fund with Promise4Wealth

50 High-Potential Companies, One Smart Decision

Name is required Name should be Valid
Mobile Number is required Mobile Number should be Valid
DOB is required DOB should be Valid
Annual Income is required
Please tick to proceed further.

Thank you for your interest in our product. Our financial expert will connect with you shortly to help you choose the best plan.

Life Insurance is one of the most important financial decisions you can make, especially if you have a family to look after. When you have a spouse and children, it is essential to ensure their future is financially secure, in case you are not around to provide for them anymore. In such a scenario, cutting corners to save a few rupees might cost your loved ones dearly. Opting for a low-cost life insurance policy might seem like a smart move today, but in the long run, when your family truly needs financial support, an inadequate or unsuitable plan can become a serious liability.

It is typical human behaviour that we tend to prefer the cheapest product available. While there is nothing wrong with saving a few bucks while choosing a life insurance plan, the question we need to address is whether that is the only deciding factor. Should the price of a life insurance policy be the only criterion we need to keep in mind?

The short answer is: NO! And here’s why. 

Unlike any other financial product, life insurance directly impacts your family’s future and long-term security. Therefore, it’s important to consider several key factors before making a decision.  Here are a few ways that will help you make an informed decision.

Key Takeaways

  • Choosing life insurance based only on the premium can leave your family underinsured in the long run.

  • Always evaluate your financial responsibilities, dependents, and long-term goals before buying a plan.

  • Riders such as critical illness or accidental death benefits can add valuable protection.

  • A longer policy term offers more security, even if it comes at a slightly higher cost.

  • The right life insurance plan is one that meets your family’s future needs, not just your present budget.

Secure Your Family’s Future with the Right Life Insurance Plan

Please enter correct name Please enter the Full name
Please enter valid mobile number Please enter Mobile Number
Please enter valid email Please enter Email
Consent is required

Enter OTP

An OTP has been sent to your mobile number

Didn’t receive OTP?

Application Status

Name

Date of Birth

Plan Name

Status

Unclaimed Amount of the Policyholder as on

Name of the policy holder

Policy No.

Address of the Policyholder as per records

Unclaimed Amount

Error

Sorry ! No records Found

.  Please use this ID for all future communications regarding this concern.

Request Registered

Thank You for submitting the response, will get back with you.

Thank you for your interest in our product. Our financial expert will connect with you shortly to help you choose the best plan.

How to Plan Before Buying a Life Insurance Policy?

Review all your insurance needs and understand your requirements. Plan for your future and your family's. Once you have evaluated all your requirements, it is time to decide whether you need a term life insurance plan or a whole life insurance plan. A term plan offers coverage for a specific period, whereas a whole life plan provides coverage for the entire life.

important-factors-01
  • Evaluate Your Financial Condition: Check up on your debt and liabilities, including loans and mortgages. Decide the amount of coverage you would require to pay them off completely. Your life cover should ideally be enough to settle all outstanding dues without burdening your family. Include short-term obligations, such as credit card debt, and long-term ones, like home loans.
  • Pick a Premium Amount: Decide the amount of premium you'll be able to pay regularly without compromising your current lifestyle. Avoid overcommitting to a plan that may later lapse due to non-payment. Remember, life insurance is a long-term commitment; choose a premium that feels sustainable over the years. It’s better to pick a slightly lower cover that you can maintain consistently.
  • Factor in Your Dependents: Contemplate the factor of how many dependents you have and how much financial support they will need once you are not with them. In case something unfortunate happens, how much money would be required for your children's education, your parents' comfort and your spouse's well-being?
  • Check for Riders: While purchasing a life insurance policy, take riders like accidental death benefit, critical illness care, return of premium, etc. These add-ons provide an extra financial cushion in case of specific unforeseen events. They can help you customise the policy to match your health risks and lifestyle. These riders can cost a little, but the benefits provided by them are definitely worth the extra cost.
  • Carefully Choose the Term of the insurance: While comparing life insurance policies, if you come across two different policies providing the same cover at different premium rates, check the duration that they cover. For example, a term life policy charging ₹6000 annually for a cover of 25 lakh and is valid for 50 years is better than a policy that charges ₹4000 annually for the same amount of cover but is valid only for the next 20 years.

Common Mistakes to Avoid When Choosing Life Insurance

Many people unknowingly make mistakes that can cost their families dearly down the line. Before you finalise your policy, it’s important to be aware of these common pitfalls, so you don’t end up with coverage that falls short when it matters most.

  • Underestimating coverage needs: Picking a sum assured that’s too low to cover your family’s real expenses can leave them financially vulnerable.

  • Ignoring policy terms: Focusing only on premium without checking how long the coverage lasts can backfire when protection ends too soon.

  • Overlooking riders: Skipping add-ons like critical illness or accidental death benefits to save money might cost more in the long run.

  • Not disclosing health issues: Failing to share accurate health information can lead to claim rejection later.

  • Delaying purchase: Waiting too long to buy life insurance increases premiums and risks leaving your family unprotected.

Avoiding these mistakes helps ensure you buy a policy that truly safeguards your loved ones, not just your wallet.

Why the Right Life Insurance Plan Matters More Than the Cheapest One

Many people assume that all life insurance plans offer the same benefits, so they pick the one with the lowest premium. But that approach can be misleading. A cheaper plan might miss out on key features that could be crucial later on.

Not every plan is built the same. Some may have limited tenure, exclusions you didn’t notice, or cover amounts that fall short of your family’s actual needs. These small gaps can lead to big problems in the future.

That’s why it is important to look beyond just the price. A well-matched plan takes into account your responsibilities, future goals, and the kind of support your family may need when you're not around.

Conclusion

When it comes to life insurance, there’s more at stake than just choosing a plan with a lower premium. A well-thought-out policy can offer your family the financial security they need when you’re no longer around. That’s not something you’d want to compromise on just to save a little money today.

The purpose of life insurance is to help your loved ones in their time of need. Therefore, buy a product that fulfils their requirement and is not just offering a better price. You can use the above-mentioned factors as basic guidelines for choosing the right policy, but the final decision has to be made by you only. Therefore, your family's needs should guide the purchase. After all, the right cover is the one that truly protects the people who matter most.

If you're considering term insurance, explore the term plans by Canara HSBC Life Insurance. We offer a range of options designed to suit different life stages and financial goals, helping you secure the future of your loved ones with confidence.

Disclaimer - This article is issued in the general public interest and meant for general information purposes only. The views expressed in this blog are solely those of the writer and do not necessarily reflect the official policy or position of Canara HSBC Life Insurance Company Limited or any affiliated entity. We make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability, or availability with respect to the blog or the information, products, services, or related graphics contained in the blog for any purpose. Any reliance you place on such information is therefore strictly at your own risk. You should consult with a qualified professional regarding your specific circumstances before taking any action based on the content provided herein.

Recent Blogs

What is a Trust in Life Insurance? Complete Guide
01 Apr '26
38 Views
7 minute read
Learn what a trust in life insurance is, how it works, and how it provides tax savings, faster claim payouts, and financial protection for beneficiaries.
Read More
Life Insurance
What is Conditional Assignment in Insurance Policy?
01 Apr '26
87 Views
6 minute read
Understand conditional assignment in insurance, including its meaning, benefits, examples, and when it becomes effective.
Read More
Life Insurance
Which Government Life Insurance Schemes are Best in India?
01 Apr '26
110 Views
7 minute read
Explore government life insurance schemes in India, their benefits, eligibility, premiums, and how they secure financial protection for families.
Read More
Life Insurance
What is Keyman Insurance? Meaning & Benefits
01 Apr '26
49 Views
10 minute read
What is Keyman Insurance? Learn how it works and why businesses use it to protect against financial loss from losing key employees.
Read More
Life Insurance
What is a Rebate in Insurance and How Does It Work?
01 Apr '26
342 Views
8 minute read
Learn what a rebate in insurance means, how it works, and the rules you should know before buying an insurance policy.
Read More
Life Insurance
What Is an In-Force Policy in Insurance and Why It Matters?
31 Mar '26
59 Views
6 minute read
Learn what an in-force policy in insurance means, how it works and why maintaining an active policy is important for financial protection.
Read More
Life Insurance
What is Basic Premium in Life Insurance and How Does It Work?
25 Mar '26
105 Views
6 minute read
Learn what basic premium in life insurance means, how it is calculated, and why it matters when choosing the right life insurance policy.
Read More
Life Insurance
What is Net Premium in Insurance and Why is It Important?
25 Mar '26
111 Views
7 minute read
Learn what net premium in insurance means, how it is calculated, and why it plays a key role in determining policy costs.
Read More
Life Insurance
Who is an Insurance Agent? Role & Responsibilities Explained
18 Mar '26
106 Views
8 minute read
Learn who an insurance agent is, the role of an insurance agent, and how they help you choose the right insurance coverage and manage policies effectively.
Read More
Life Insurance

Life Insurance - Top Selling Plans

We bring you a collection of popular Canara HSBC life insurance plans. Forget the dusty brochures and endless offline visits! Dive into the features of our top-selling online insurance plans and buy the one that meets your goals and requirements. You and your wallet will be thankful in the future as we brighten up your financial future with these plans.

Family Shield: Enhanced Protection

iSelect Smart360 Term Plan
  • 3 Plan options
  • Life cover till 99 years
  • Steady income benefit
  • Block your premium at inception

Start Young, Pay Less, Stay Secured

Young Term Plan
  • Life cover till 99 years
  • Coverage for spouse
  • Block your premium rate
  • Covers 40 critical illness

Fixed Returns, Zero Risks & Worries

iSelect Guaranteed Future Plus
  • 4 Plan options
  • Life cover + Guaranteed benefits
  • Accidental death benefit
  • Premium protection cover