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Planning to buy a term plan?
Avoid the mistakes I made!

Planning to buy a term plan? Avoid the mistakes I made!

A cat has 9 lives, they say. Whether it is true or not, you'll never know. But, what you do know is that you only have one life to make the most of. I do realise that now, but my recklessness cost me some mistakes that I deeply regret. I am 38, got married five years ago, and am blessed with a 3-year-old son and a 2-year-old daughter. But when I decided to buy a term plan at 31, there were a whole of things I failed to take into account. What if something were to happen to me today? Given my pending home and car loan instalments, was my term insurance cover enough to support my family's financial needs? The answer was 'No'.

As I look back and analyse my financial decisions, I realise there are so many things I wish I could go back in time and change.

Here are some of the mistakes I made while buying a term plan:

Opting for a short tenure

Although it is entirely up to you, I strongly suggest you opt for a decent policy term. Consider my case; I was 31 when I bought term insurance for a tenure of 10 years. But when I turn 41, I will literally have no cover at a time when I need it more than I do now, simply because financial risk and liability will both be higher post 40. And if I decide to buy another policy at 41, the premiums I will have to pay will be much higher than what I'm paying right now.

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Buying insufficient cover

Not only did I choose a short term, I also bought a low cover just to save a few extra bucks on premiums. I conveniently ignored taking inflation - and my outstanding loans - into account. Now that I look back, I realise it was a silly move on my part. After mindfully calculating future expenses, I've realised that my family would definitely not have enough if something were to happen to me today. Therefore, I urge you to do the necessary calculation before buying a term plan. Don't worry; here is an insurance calculator that will do the job for you.


I was well-informed about the need and importance of term insurance right from my early 20s, but thanks to my inherent tendency to put off important tasks, I delayed buying one. I kept postponing it to the next month, when I thought I would be in better control of my finances. But each month I had a new excuse! This went on until about seven years ago, when I finally decided to buy a term plan. But it came at a price. My premiums are higher than they would have been had I purchased the plan early. Also, now that I have more responsibilities and expenses, it's slightly more difficult to spare that amount regularly. Long story short - the right time to buy term insurance is 'right now'.

Ignoring riders

Another major oversight that I regret today is ignoring riders that I could have bought along with my plan. At that time, I thought I wouldn't need an optional accidental death benefit or accidental and permanent disability rider. But, now that I've done my research, this seems a huge mistake. If I meet with an accident that leads to my disability, how will I ensure that my family's financial needs are met? Given that I'm the sole breadwinner, it was even more important for me to take relevant riders into account when buying a term plan.

Now that you know the mistakes I made when buying a term plan, I hope you learn from them and be wiser when purchasing one for yourself. If you're looking for a hassle-free term plan that can be customised according to your needs, consider iSelect. It is a pure protection term plan that offers life insurance and terminal illness cover along with optional cover against accidental death/disability. You get to choose the premium payment mode as well as the premium payout option. Learn more about the plan here.

Even after accounting for the mistakes I made, buying a term plan was one of the wisest decisions of my life and it's something I would urge everyone to go for if they wish to secure the financial future of their loved ones. And who doesn't?

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