Common Mistakes People Make When Buying Insurance
When you choose a life insurance policy, you want to secure your family’s finances. However, buying an insurance policy can be a time-consuming decision. You want to make the best choice for you and your family’s future. This requires a careful analysis of the benefits you want from your life insurance plan. Sadly, many individuals fail to do this and take an insurance policy that is inappropriate or insufficient for their needs.
To help you avoid some costly errors like this, Camlife Financial Corp has put together a list of the most common mistakes people make when buying insurance.
1. Not considering disability insurance
A long-term disability can wreak havoc on your investments and savings if you are not wholly prepared. Disability insurance gives risk coverage for the lost income due to the inability to work because of a permanent or temporary disability. This kind of insurance would cover a part of lost income if one met with an accident or illness that led to their disability. It includes coverage of payment during sick leave and offers disability benefits for short and long-term periods.
2. Buying a term that is too short to meet the need
Another common mistake people make is purchasing insurance policies for too short of a term. You don’t want to have to apply for and qualify for insurance in your fifties. Health problems start during middle and old age, and hence everyone should choose a program with longer durations. Speaking to a qualified insurance agent will help you navigate to a better coverage plan.
3. Underinsuring
Underinsuring can be rather costly when one realizes that their primary insurance will not cover the required expenses. People usually buy a plan which they believe will be light in their pocket. They don’t understand the insufficient and low coverage these insurance policies give in the event of a health mishap or death.
4. Buying the bank’s mortgage insurance instead of term life
Every time someone takes on a mortgage, lenders offer creditor insurance. Most lenders push for their mortgage insurance as their profit margins are high. We would advise clients to consider term life insurance over mortgage insurance.
5. Not disclosing medical history on file with their doctor
For fear of the insurance company refusing the insurance application, people lie about their medical history by hiding relevant information. Unfortunately, not disclosing medical history could lead to the rejection of claims when the insurance company does its due diligence and background tests. Many individuals feel that they are saving money on the premium, but it is a short-term saving with absolutely no long-term gains. When one goes for a life plan, they must make sure to disclose all vital information to their insurance agent. They should think of the larger picture and have their family’s best interests in mind at all times.
6. Using a broker who only deals with one insurer
It is best to choose an insurance broker who deals with more than one insurer. This ensures that you get the best policy in the market and not just the best the broker can offer.
To avoid these and other mistakes when buying insurance, reach out to the experts at Camlife Financial Corp. We help people with their financial planning and investment requirements. We know that everyone’s situation is different; therefore, we take the time to learn about our clients before pitching insurance products. Once we define specific needs, we devise a plan and go to the market to see which insurer and investment company will be the best fit for them.
We serve clients across Vancouver, Richmond, West Vancouver, North Vancouver, Burnaby, Surrey, White Rock, Langley, Coquitlam, Maple Ridge, and New Westminster, BC.
For a complete list of our services, please click here. If you have any questions about insurance, we’d love to hear from you. Please contact us here.