There's so much hype out there regarding life insurance and it can feel frustrating to try and read through the details to determine what's best for you. Let's walk through some very common life insurance mistakes so you can avoid them. If you haven't purchased a policy yet, the new year is a great time to tackle that New Year's Resolution to get your financial affairs in order.
Not Having Coverage
Too many people assume that they can go without life insurance coverage. This is a very common mistake that can end up costing you thousands of dollars. If you have not purchased a policy already, it's safe to assume that you believe you are a self insured individual. Unless you have 10 years worth of income socked away in the bank to help support your family, an accident that results in you passing away, could cause significant financial distress for your loved ones.
Many people make the mistake of assuming that life insurance is too expensive for them to obtain. There are so many life insurance companies out there, all with different categorizations of rates and treatments of various medical ailments. Simply doing some research and looking around can save you a lot of money. Don't hesitate to make a life insurance purchase because you believe that you don't need it or that it's too expensive. Both of these are common myths.
Not Getting Enough Coverage
So you finally jumped over the hurdle of purchasing a policy, but you're nervous about the bottom line cost. So, your response is to elect a policy with a smaller face amount, perhaps $100,000 or so. While of course is necessary to have some level of coverage, think about whether the face amount you've selected will actually cover your family and their expenses over time. Will that help pay the mortgage? Support children through college?
Every so often we see individuals come through with policies of $426,756 in coverage or some other odd number. This isn't because they randomly selected their lottery numbers as their face amount. These are the people we know spent the time calculating exactly how much coverage they need. Use a worksheet to take into account debts, income replacement, and future expense needs for your family. A one size fits all approach may not work for your family.
Not Paying The Premium On A Term Policy
Most life insurance carriers have a thirty-day grace period for you to get that premium payment in. Skip that, though, and you could be looking at getting the policy reinstated. Carriers have extremely strict rules about reinstatement. Some will allow you to reinstate within 60 days of the missed payment and others might require you to go through underwriting all over again. Life insurance is definitely the kind of purchase you need to make and then hold onto. Don't let your policy lapse without a major calendar reminder to pay that premium before the reinstatement period expires. If you can't reinstate, you have to apply for a whole new policy. Save yourself some time!
Not Shopping Around
Yes, you can easily identify some companies online that are the cheapest. But if you have a medical condition, make sure that carrier has a fair view of that condition before you apply. You may want to look into the company's financial rating as well. A little bit of research goes a long way. This often can't be done without an expirienced agent so make sure you pick an independent life insurance agency that can compare rates with many companies on your behalf and recommend the one most favorable to your situation.
If you have more questions you can feel free to visit InsureChance. We are an independent online life insurance agency that lets you compare Term Life and No Medical Exam life insurance quotes online.
Article Source: http://EzineArticles.com/expert/Sean_Dudayev/1694412
Post a Comment