So you’ve signed up for a life insurance policy (or are planning to). Congratulations! Getting life insurance is not only a step to maturity, as it shows you care enough about others to make sure that they live comfortably for a while should anything happen to you, but something that brings you peace of mind as well. But there are plenty of things that you don’t know about your insurance plan and many of them are things that your provider doesn’t want you to know at all. Here are some of them.
– Low-Load or No-Load Policies Cost Less
When signing up for a policy ask about these options. Most policies pay the agent signing you up for insurance on a percentage commission basis. No- and Low-Load
Policies charge a flat sum so they can be considerably cheaper.
– You Pay Less if You Pay All Your Yearly Rates Together.
Most companies appreciate when a customer pays all his yearly dues up front. You might even get a significant deduction for paying your insurance premium in a timely fashion.
– You Can Save Money if You Know the Different Policies
If you already have insurance you probably know the differences between Term versus Whole Life insurance. The former expires but is cheaper whereas the latter continues until cancelled (and the money withdrawn) but is quite expensive. Well, there is a third, middle way, called Level term insurance. Level term insurance has the benefits of Term insurance (low premiums) with those of whole life insurance. You sign up for 20 or 30 years of low premiums and, at the end of that period you have the option to renew without a fitness test that might increase your premiums.
– You Should Always Read the Smallprint
The Insurance business is a profit based one and a lot of brokers are shifty and unreliable enough to let you to sign a contract without reading it beforehand. There can be dozens if not hundred clauses in a contract designed to limit the responsibility of the company and push that burden upon you, preferably without having to pay you or your family a cent. A good example is the recent case where people whose houses were damaged by Hurricane Sandy were told that their homeowners insurance did not cover their damages to the house as they needed the ’natural flooding’ rider as well. Don’t get duped by the document length and always carefully read it , preferably with an attorney alongside you.
You should be really careful when selecting a life insurance policy. If you’re not you could end up paying a lot more than you should and getting little in return. So carefully research the type of policy that you want beforehand on the Internet and don’t accept any useless riders. Most importantly, always read the small print!