Nobody likes to shop for life insurance, and it is true that this purchase can be
fraught with financial peril as well as emotional baggage.
Even so, it is important for every individual to consider his or
her insurance needs carefully in order to protect their family and all
they have worked so hard to obtain. Living
without life insurance can leave your family vulnerable and cause serious
financial hardship in the event of your untimely demise.
When shopping for life insurance it is important to avoid some of the most
common mistakes other shoppers have made.
A life insurance policy can be a complicated purchase, and it is
important to carefully consider all of the options before making a final
One mistake that life insurance shoppers may make is falling into the
temptation to lie on the insurance application, or at least omit some
unpleasant truths about their health and lifestyle habits.
For instance, life insurance companies routinely offer preferred
rates to policyholders who avoid smoking and other unhealthy habits.
Claiming to be a nonsmoker while nurturing a pack a day habit could
come back to haunt your family later on by causing the death benefit to be
denied. It is better to be
upfront and honest on the applications and then compare premiums among
several different companies in order to get the lowest monthly premium.
It is also a good idea for first time purchasers of life insurance to get a
complete physical before they apply. Knowing
your state of health going in can help you get a better rate and ensure
that the application is completed properly.
Most insurance companies will require a physical as a condition of
insurance, and some will require a follow-up examination in order to
approve a significant increase in coverage.
It is a good idea to beat them to the punch by having a complete
physical workup done by your regular family physician.
Many first time life insurance shoppers also go in not knowing how much
coverage they really need. While
there is no one answer for everyone, it is important to consider a number
of factors, such as family size, annual salary, the amount remaining on
the mortgage and the income needs of the family.
Having these figures available will make it much easier to
determine exactly how much cover is needed.
Some families will need life insurance cover for a specific
purpose, such as paying off the mortgage, while those households with
young children may need enough cover to provide the family with a
reasonable monthly income until the last child has graduated from college.
It is important for every life insurance shopper to look carefully
at his or her specific situation in order to get the best coverage for the
lowest possible price. To take a typical example, Insurance
Companies actually offer two distinct forms
of life insurance – typical cover which will give your family a cash
lump sum or Mortgage Life Insurance which will pay off all or part of your
As with any form of insurance it's a good idea to shop around for the best
deal. These days however a number of big insurance providers will
effectively search the market for you sourcing their products from a wide
range of insurers so that when you get your quote you know it's the best
deal from a diverse pool of policies.