5 Unforgivable Misconceptions and Mistakes in Life Insurance 2022 Update

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Life Insurance Misconception #1. You Can Buy Life Insurance Policy at Any Time.

life insurance
life insurance

Alexei, a man in his 40s. He decided to take out a policy with a life insurance company and wrote an application.

However, he did not make the first payment in any way.

The policy becomes effective with the first payment.

In the end, for some unknown reason, the man decided to postpone taking out the policy until September. He was on vacation, on vacation – he didn’t have time for that.

In September he paid, and the policy took effect.

As a result,

in January the man is diagnosed with cancer. And the insurance is in place, and that’s it.

However,  it is important to know that after the insurance has been issued, it must be 180 days before a person can receive payment for illnesses (this does not apply to injuries or accidents).

This is how the company insures itself against the fact that the person will buy the insurance at the time of a serious illness. If Alexei had taken out a policy in July, he would have received benefits…


Dangers are everywhere. You can’t plan for when you really need an insurance policy. The main problem with an insurance policy is that you can’t buy it when you need it. Get it in advance and live your life in peace.

Life Insurance Misconception #2. Many Accidents are not covered by Insurance.

life insurance
life insurance

The insurance contract specifies specific cases in which there will be a 100% payout.

However, there will be no payout if the insured wants to cheat the system.

In my insurance agent’s practice, there was one girl who got pregnant and decided she was due a payout!!!

She reasoned that there was an accident – an external impact that caused a change in health and temporary disability.))

Of course, the insurance company denied compensation.


No need to try to cheat the company if the situation is obviously not in your favour.

Life Insurance Misconception #3. Insurance Companies Go Bankrupt Very Often and you can Lose Money.

life insurance
life insurance

I am insured by a well-experienced life insurance company. Nothing happened to the company during the wars of the 19th century, World War I and World War II.

It did not stop working under any government or form of government.


You should only trust companies with a history of at least several decades. Better if the company was founded before World War II. If it has survived such a cataclysm, it means that it really is reliable!

Life Insurance Misconception #4. If I Get into an Unusual Situation, The Company will Screw Me for Money.

life insurance
life insurance

There are curious cases in practice.

Jack, a young guy with an insurance policy, suffered a ruptured tendon in his right thumb.

Before receiving money for treatment, the person must describe the situation to the insurance company, how it happened.

This is a prerequisite for receiving payment. And lying is strictly forbidden!

In the report for the insurance payout, he stated that “his finger got caught in the button loop when he wanted to take off his pants in front of his girlfriend! Tugged sharply – his finger practically stayed in his jeans.”

This same guy, with his finger already cured, while closing his sick leave a month later, fell on his way out of the hospital (with the closed sick leave in his hands) and broke 2 ribs.


You’ll never guess when something might occur to you. Jack specifically was fine.

Life Insurance Misconception #5. The Insurance Company will Take the Money, and When They Need it, They Will Find Any Excuse not to Pay.

life insurance
life insurance

The insurance contract is very clear about when you can receive payment.

Client: Andrey, 27 years old.

Decided to sign a contract with an insurance company before the May holidays.

Andrey paid the quarterly premium, did not pick up the policy and went to his friend’s house in the countryside to have a rest on May Day.

The insurance policy takes effect immediately after the payment is made.

For some unknown reason – accident or drunkenness – he fell into a cellar and broke his legs.

The insurance company paid him 2439.90$ and would not hide behind the fact that he did not have a policy.

He paid the money and the policy worked.


The insurance company abides by the contract without any reservations.

Read it carefully.

In this situation, the case was on the side of the insured, because he paid, and the existence of the policy does not matter.