Common Mistakes To Avoid When You Purchase Life Insurance

If you are considering purchasing a life insurance plan, there are a lot of pitfalls you are going to want to avoid. You want to remember that this is a life commitment, so you don’t want to make any decisions before you’ve done ample research. Here are a few common mistakes to avoid when you purchase life insurance.

  1. Don’t automatically go with the lowest rate. Many agents will quote you at a rate that you could never qualify for, long before you’ve sent in all of your medical records and completed the application. They often do this to get you excited and to get you started on the application process, but without actually walking you through exactly what it takes to get that rate. Once you’ve gone through the medical exam, sent all of the medical records and completed the application process, you may have already spent up to 8 weeks taking care of business. Which is why many people will just accept the higher rate that they actually qualify for, rather than starting all over with a new insurance company. This is why you always want to make sure that your agent breaks down exactly what it takes to get the rate that they quote, and that you’re sure you meet all of those requirements.
  2. Don’t rely on your employer to provide you with life insurance without doing your homework. If you receive life insurance through your employer, it’s important that you do a thorough amount of research to determine the stipulations of your plan. For example, will you still be covered once you retire? If you are still covered after retirement, will your rate change? If you are injured or endure a heart attack which renders you incapable of working for your employer will you still be covered? If you don’t have the answers to all of these questions, then you need to figure them out. If your employer is not providing you with ample insurance, then you may want to take care of these matters privately.
  1. Don’t forget to notify your insurance company if you successfully quit smoking. If you have successfully quit smoking and have been tobacco free for at least 6 months to a year, then you can take a medical exam to prove it and provide it to your life insurance company as proof. This could dramatically reduce your rate, or possibly even modify your policy all together. After all, people who quit smoking before the age of 40 can reduce their risk of a tobacco related death by up to 90%.
  1. Don’t wait too long before you open a life insurance policy. The younger and healthier you are, the better your life insurance rates will be. If you work for a large corporation, you may be eligible for very affordable group rates, and if you have a spouse, your company may even provide spousal coverage as well. This is especially important if your spouse works for a smaller company. This is because he or she may be required to sign up for Obamacare through their company, and that may very likely affect many small businesses and their ability to provide comprehensive healthcare as well as life insurance plans to all of their employees.

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