3 Most Common Mistakes People Make When Buying Life Insurance

May 19, 2020

Buying life insurance is not something that you would do everyday. It can be very confusing if you are not fully prepared for the process. You might end up spending way more than you should, or worse, not get enough coverage. In this article we will be explaining the most common mistakes people make when it comes to life insurance, so you can hopefully avoid making them;

  • Going with the lowest quote - For a lot of situations, the crazy low quote you see isn't going to end up being the real cost you pay. Usually, quotes are provided with very little details, and the final rate will be calculated after a life insurance provider knows more about you, and it may not be close to the first quote you've seen.
  • Not understanding your coverage - Okay, it's easy if your insurance policy works into your budget easily, you're much more likely to have it in place when you need it. But if you need to buy more life insurance later, it may get complicated.

    When you're looking for more coverage later when you're older, you're likely to pay more than you've already paid for a package. When you pair this with some recent health problems, you might see a major price rise.

  • Inflation guard - This plan automatically updates the cost of repairing your home to reflect improvements in the cost of construction. Find out whether this provision is included in your contract or if you need to buy it separately.
  • Paying higher premiums - Make sure you shop around so you don't end up paying higher prices than you have to. If you're young and shopping around in perfect health, you're likely to get a low rate from most carriers. However, if you are older and/or have any health problems or if you are a smoker, you may risk paying too much for life insurance.