Whilst it may seem a slightly morbid topic to discuss, a quality life insurance policy is so important in making sure that our family is well looked after and isn’t lumbered with funeral expenses or any other costs after we have gone. With so many companies offering life insurance and so many different policies on offer, buying the right life insurance policy can be a difficult decision, especially as it is such a vital decision to get right. A bad life insurance policy can cause serious problems down the line, and you will not be around to try and solve them.
To help you make the right choice, here are 6 tips when buying a life insurance policy.
1. Do Thorough Research
There are tens of thousands of life insurance options available to you, so make sure you do thorough research to find the best policy for you. As, hopefully, you still have a long and healthy life ahead of you, you can afford to take a few weeks finding the absolute best choice of policy to suit your needs. There are so many great life insurance comparison websites online, which can enable you to find a guaranteed universal policy to cover you in whatever circumstances. Guaranteed life insurance policies don’t require any medical questions or tests and so can be a convenient way of getting life insurance. Just make sure you do your homework online to get the best deal out there. Comparison sites will show you the financial strength of the different life insurance companies, as well as any noted weaknesses.
2. The Initial Quote
Essentially, life insurance quotes are no different than going to an auto insurance store and getting a quote on auto insurance. When you are given your initial quote, they don’t have your medical records in the same way that auto insurance companies don’t have your driver’s record when they give you the first quote. The initial quote is only to draw you in and may end up bearing no resemblance at all the ultimate policy costs. A quote turns into an offer after a process called underwriting, and underwriting simply means they take your medical information and verify that information.
3. Ignore the Marketing Spin
Although the way of marketing life insurance has dramatically changed in the last fifteen or twenty years, the way that an application is taken hasn’t changed much at all. Essentially, you collate your information and submit it to the life insurance company that analyzes it and makes you an offer. Ignore the hype on cash value versus term insurance as what matters is that you get a policy that is in force when you need it. There are life insurance policies out there now, which are called permanent policies with no cash value at all, so just focus on the features that you want from your policy and ignore the marketing spin.
4. Tell the Truth
When you complete the application forms, it is very important to tell the truth as far as whatever medical conditions you’ve had and what medications you are currently taking. If you’ve ever been to the hospital and was given a paper patient bracelet, there will be a record of it somewhere. Make sure that you are honest and the life insurance company will be able to offer you the correct rate of insurance that is proper for your circumstances and medical history.
5. Do Not Allow Yourself to be Upsold
Life insurance company sales teams are often going to try and upsell you a policy that you don’t want or can’t afford, and it is so important that you do not allow yourself to be coerced. Even if what is on offer sounds appealing, it is not going to be the right choice for you if you cannot pay for it. It is so important that you know exactly what you want from your life insurance policy and how much you can afford to pay so that you are not at risk of being manipulated by sales tricks.
6. Your Medical or Personal Information
When the life insurance company asks for your details, don’t feel embarrassed about sharing them. When you give the information to the company, there’s nothing personal about it at all. It is simply put into a statistical scoring sheet, which will enable them to come back and tell you what the rate they typically offer is. There are various rates called super preferred rate, preferred rate, standard plus rate, and standard rate, and they are going to depend on your age, height, weight, relative blood pressure, and cholesterol levels.
Finding the best life insurance policy is a very important decision, so it is one that requires careful consideration. There are so many options available that you need to take your time and research all the different policies on the market. Follow the tips laid out in this guide, and you will find the best life insurance policy for you.