Before You Buy Life Insurance, Get the Facts
Before you buy life insurance policy, it’s important to get the facts and do your research. Nowadays, this is much easier with the many resources available on the Internet, but too often, people rely on the advice of a know-it-all friend, family member or even a pushy insurance agent.
Buying life insurance is an important decision and a major commitment. Before you sign the dotted light and buy your policy, there are several things you should know. To get the best coverage for your hard-earned dollars, follow these 10 important tips:
1. Don’t put off buying life insurance. You know that you will need life insurance sooner or later, and now is the best time to buy. Purchasing early in life, while you are young and healthy lets you choose from the best policy possible, and allows you to save money on premiums.
2. Shop around. Before signing the dotted line, take the time to browse the market. Learn about the various insurance companies, review the different policies available and compare rates. The Internet is an excellent source of information. Do a little homework today and you’ll save money tomorrow. Take the advice of friends and family members with a “grain of salt.” Do your own research first and then you will be confident in making a wise decision when it’s time to buy.
3. Stay Healthy. People with healthy bodies and smart lifestyles pay the lowest premiums. People who smoke, drink, take drugs, suffer obesity or even have poor driving records will pay a great deal more for life insurance.
4. Find the right amount. Some people make the mistake of buying more insurance than they need, and ultimately paying a higher premium. On the other hand, others may under insure themselves by choosing a policy that is too small. Try to find the happy medium and find the insurance plan that best suits your individual needs.
5. Save money with more coverage. Most insurance companies offer price breaks at 1 million dollars of coverage. If you can afford to, consider increasing your coverage, as premiums tend to get cheaper as coverage amounts increase.
6. Review your current plan. If you already own life insurance, it’s really important to review your policies regularly. Whenever you undergo a life changing experience. If you have a child, or if your children are entering college, move to a new home, take a look at how your policy may be affected. Periodic reviews help you ensure that you continue to have the coverage that you need, and that you are paying the right premium.
7. Watch out for captive agents. Although, not as common today as several years ago, captive agents are insurance agents that have a big company name on their business cards. Most of these agents are not independent and rest-assured, they will try to sell you a policy with their company name on it. Watch out! You will pay more and the agent will earn more.
8. Don’t count solely on your employer. Group life insurance is a nice benefit, but it may not be enough to meet your needs. Additionally, most group life insurance policies are terminated should the employee choose to leave the company. The most reliable long-term coverage you can have is an insurance policy that you’ve purchased yourself.
9. Choose annual payments. If you pay your life insurance monthly, you will pay a higher premium – just like your auto and home insurance. In order to save money, change your plan to half-yearly or annual payments.
10. Tell the truth. Never lie or hide information when you apply for life insurance. If you are found guilty of hiding the facts, such as trying to cover up a smoking habit, the company has the right to terminate your policy at any time.
Choosing a life insurance company and buying a policy are important decisions and sometimes very confusing. There’s no such thing as too much information. Find out all you can and make sure you’re receiving the best coverage available before you commit to your new life insurance purchase. Feel free to contact us if you would like a quote and some unbiased information about life insurance.