ThE FIvE dO’S ANd dON’TS FOR ThE lIFE INSURANcE BUYER

Chapter 19

theeDFI v o’s AnD

Don’ts FoR the lIFe

InsURAnCe BUYeR

By Kyle BlaCKBUrn

The most important thing to consider when buying life insurance is to
determine what your need is and for how long.

When people come in my office I always ask the question “how did you
decide how much insurance you need?” Usually the answer I get is a
blank stare or “I don’t know.”

Mistake number one is buying the wrong kind of coverage. When you
sit down with your insurance professional, if he starts off asking you
how much do you have to spend as a starting point, you probably need a
new advisor. Your needs and concerns should be the first thing discussed
not how much money you have to spend.

Some interesting facts: most term insurance policies never end up in a
death claim. Less than ½ of 1% of all term policies issued end up in a
death claim. This is not because the insurance company will not pay,
they most certainly will...if you die. The problem is that you probably
will not die during the specified time period, and when your policy is up
for renewal, the premium will likely increase to a price you can’t, or do
not want, to pay.