In a time when we’re all thinking a little more about our loved ones and finances, securing life insurance is a smart decision. Life coverage is designed to provide some financial security to your family after you’re gone. While the recent pandemic has made us consider our options, there are some common mistakes to avoid making before you dive into a policy.
Mistake: Choosing the wrong type of life insurance
Term insurance covers you for a set period of time, such as 5 or 10 years. A permanent life insurance policy stays in effect over the course of your life. It allows you to build cash value that you can draw against later on. While a term policy is cheaper, whole life may offer better protection for your family as it is intended to be for life. Assess your family’s needs and work with an agent who can secure the right policy.
Mistake: Underinsuring yourself
Life insurance could easily cost less than you expect if you’re young and healthy. For a small additional cost, you could add more coverage that adequately protects your family and provides a huge gift to your beneficiaries.
Mistake: Not reviewing coverage regularly
There’s more to life insurance than just paying premiums. Your situation may change continually, which calls for you to review and adapt coverage as needed. For example, if you get a raise at work, you may wish to increase your life coverage to reflect that.
Mistake: Not reviewing how you pay
There might be a difference in premiums when choosing monthly payments or annual payments. If you can pay on an annual basis, your life coverage might be cheaper.
Life insurance can be complex and difficult to understand at first. If you have any questions about coverage and how it can help you, contact the team at Tompkins Insurance Agencies for help finding the right solution for your family.