Understanding
common
life insurance myths can help steer your insurance decisions in the
right direction.
“We want consumers
to understand the life insurance process before, during and after they
buy policies,” said Amy Danise, senior managing editor of Insure.com.
“Misunderstandings can lead to bad financial decisions.” Below are some
of the most common myths.
Myth #1: There’s a
universal database of life insurance policies that I can use to find my
relative’s policy number
This problem often
starts with the insured person, who never fully divulges where the
policy paperwork is kept. Beneficiaries can’t make a claim without
knowing at least the name of the life insurance company. Unfortunately
there is no company or agency that tracks all life insurance policies
sold in the United States.
Myth #2: Anyone can
take out a life insurance policy on you
Your friend,
neighbor, sibling – even spouse – can’t
buy life insurance on you without your knowledge. The application
process usually requires a medical exam – or at least your signature on
papers.
Myth #3: Life
insurance companies look for ways to reject people
When we talk about
buying life insurance, we often end up talking about medical conditions
and other risks that can knock you out of the market. But life insurers
do try to offer
life insurance quotes to applicants with medical problems.
Myth #4: I have
group life insurance through work so I’m all set
The life insurance
you buy through work isn’t portable. If you lose or leave your job,
you’ll be without life insurance. It’s a much better plan to buy life
insurance on your own.
Myth #5: A life
insurance application rejection means you’re uninsurable
A rejection from
one company doesn’t mean that others will do the same. It’s important to
keep looking.
Myth #6: My spouse
is still young and can go back to work if I die
Assuming your
surviving spouse will quickly find well-paying work isn’t a good
financial plan. Life insurance also allows you to provide college
tuition and money for other large expenses if you’re no longer around.
Myth #7: The
government will take care of my family
Payments from
government sources like Social Security are inadequate to provide
financial stability in the event of your death.
Myth #8: You can’t
change your life insurance rate after you buy the policy
If your health has
improved substantially since your policy purchase, you might wish you
had waited to buy in order to get lower
life insurance rates. But you can ask your insurer for a
re-evaluation of your rate. And if your life insurance company won’t
lower your rate, you can still shop for a new policy at a better price
and then drop your old one.
About Insure.com:
Insure.com provides free insurance quotes and a comprehensive array of
information on auto, home, health, and
life insurance. We offer an extensive library of originally authored
insurance articles and decision-making tools that are not available from
any other single source.
Disclaimer: The Google Translation that has been added to
pages within the Pendleton-Gazette was done solely as a tool to help those who
speak other languages. It is not guaranteed to be 100% full prove (accurate)
when a translation is performed because of sentence structures in languages
other than English do vary.
