Things A Life Insurance Agent May Not Tell You
Are you sure that your life insurance agent is telling you everything you need to know before you have to make a coverage choice?
A life insurance agent will only explain the positives of the policy benefits and costs to you. This is because they’re in the business of selling policies and it is their goal to convince you to buy their prescribed insurance coverage.
You can protect yourself by doing your own research so you’ll be able to understand how the basics of life insurance works. It’s also necessary that you ask questions about all the things that aren’t clear to you.
Your needs are not the same as other people’s needs so it’s important that you ask relevant questions based on what your needs are.
Here are some of the things that your life insurance agent may not tell you:
Not A Necessity
A lot of people can definitely enjoy the benefits of protection that a life insurance policy provides, however, each person’s situation is different. Not everyone needs life insurance, it seems like that’s just not right, but it’s actually true.
If you die, life insurance coverage is there to serve as your income replacement so that your dependents will be provided for. That is the main purpose of a life insurance policy.
If you’re the breadwinner of the family and you have a spouse or children heavily relying on your income, purchasing a life insurance policy is definitely a wise decision.
But if you are someone who doesn’t have any dependents, getting a life insurance policy could be a total waste of money, unless you have a favorite charity and plan to add them as your beneficiary.
There are also some people who have enough financial capability to make sure that their dependents are well cared for should they die unexpectedly. You may not need life insurance if your savings and investments are enough to cover your primary expenses.
Agents Are Salespeople
Insurance agents can be super nice and sincere when they tell you that your life insurance coverage isn’t enough. But, keep in mind that life insurance agents are generally paid on a commission basis. It’s your responsibility to make the right choice for you, your family, and your needs.
It is an advantage for the agent if you buy a more expensive policy because they’ll earn more money from the sale. There are times when agents will urge you to replace your existing policies so they can generate more sales. Again it’s your responsibility to make sure you choose what’s right for your situation.
You shouldn’t be afraid to ask your agent about their commission on the different insurance products they sell. Also make sure that your agent can justify the cost if he or she asks you to upgrade to a more expensive policy.
Less Can Be More
It may seem like a great idea to purchase more than one life insurance policy even if you don’t need them. But your bank account will suffer from the unneeded strain of taking on that extra coverage.
It’s been pointed out that it’s a good idea to have just enough coverage for you to finish paying off your mortgage. After that, you should select the right coverage amount based on the necessity of your dependents.
If your children are grown and you’re widowed, you will less likely need life insurance. If you’re a breadwinner with a spouse and you also have three children, you’ll definitely need it for them.
Purchasing life insurance coverage should always depend on what your goals and needs are. Always remember to ask questions of your insurance agent and be sure you make the correct choice for your needs.