Elderly man with young boy on at park

Confonting Myths: Separating Fact From Fiction

When you shop for affordable term life insurance online, you're bound to run into a few myths. Misinformation about coverage abounds, especially online. We'll dispel the seven biggest lies here.

  1. Smart shoppers purchase a policy worth five times their annual income. Following an overly simplistic rule of thumb when looking for a plan online doesn't necessarily make you a savvy shopper. In some cases, a plan worth five times your annual earning may not be enough. In other cases, however, that level of protection may be excessive.
  2. If you shop online, you are guaranteed the lowest rates. Looking into purchasing a plan online is a great way to research prices and comparison shop, but you can't assume that you will automatically receive the lowest premiums. You should also talk to an agent or broker to be thorough.
  3. All policies are pretty much identical except for the coverage amount. This could not be further from the truth. Every plan will contain different exclusions, or circumstances in which they won't cover a claim. For instance, your plan may not pay a claim if you commit suicide within a certain amount of time after purchasing your policy.
  4. Policyholders should name their estate as the beneficiary. Doing so will require that the proceeds of the policy go through probate, which could take up to a year. Additionally, the policy will be subjected to the estate tax.
  5. People with medical problems cannot get life insurance. Even if you have health issues, you can still find affordable protection. In fact, certain insurers even specialize in this type of high-risk safety net. The key to finding a policy when you are in poor health is to shop around.
  6. Lady in green dress using laptopAn agent will know exactly what you need. An agent will not be as concerned with finding you what you need as much as maximizing commission. For example, some work for companies that only offer lucrative permanent policies, in which case the professional is unlikely to suggest a term option, even if that is what's best for your situation.
  7. Life insurance is more important than disability coverage. For people under 50, the likelihood of becoming disabled is 50% higher than that of dying. Finding affordable term coverage is important, but you should also investigate disability options.

Now that you have cleared up some of these lies, and know the advantages of term life, you are ready to make your decision about affordable term life insurance online.

Other Resources
Bottom image