Life insurance policies provide a financial safety net that can support you in case something bad happens to you. Despite this, extra precaution should be taken in purchasing life insurance, as some agent don’t have your best interest at heart, and can offer you something you don’t really need. Below are some examples of life insurance policies you should avoid:
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1. Guaranteed Issue Insurance
- This insurance policy is offered to customers who are not insurable or whose insurance is estimated to cost high due to their age or health factors. The guaranteed issue life insurance will usually offer advantages such as not requiring you to have a medical exam and guaranteed approval for life insurance regardless of your health conditions. The disadvantage with such a plan is that the death benefits you get will just be equivalent to the amount of the insurance policy you paid if you die within two or three years. If you do make it past the period indicated, you will only get very low death benefits that won’t really be much of a help at all. Instead of purchasing this type of insurance, try looking for a term insurance that is suited for older customers, if you are worried about high premiums for older customers.
2. Accident Insurance
- It is really not necessary to purchase a travel or accident insurance because most people in general travel to their destinations safely and without any harm. You should not pay more for insurance just because you will die due to an accident, as opposed to dying naturally from getting sick. Rather than purchase a travel or accident insurance, just save your money for other travel expenses.
3. Life Insurance for children
- One of the main purposes of getting a life insurance policy is to protect your loved ones who are dependent on you financially from being left without sources of income. As such, it would be irrational to get an insurance life policy for your children as they are healthy in general, and will still live for a long time. Apart from these, children also don’t get their own income, and no one really depends on them for financial needs. Rather than purchase life insurance for them, it is more advisable to set aside money for other more important needs such as their college education.
4. Permanent/Universal Life Insurance
- This type of life insurance policy is more expensive than your usual type of insurance because the insurance company will tell you that the extra money you invest in them will be invested so that you will get income returns. But in choosing this kind of life insurance, your investments will not really grow due to the charges and high cost of the insurance. Therefore, it is more advisable to go for a term insurance plan rather than a permanent/universal life insurance policy.
Getting a life insurance policy is beneficial if you know how to look for the right one. Steer clear from purchasing guaranteed issue, accident, life insurance for children and permanent insurance as they won’t provide you with much benefits, and they will just require you to spend more than you should. There are many life insurance policies that will provide you the coverage you need to ensure that you get the proper amount of death benefits, hospitalization and medical support, and so forth. All you need to do is research, consult experts and don’t be afraid to ask questions before committing.
