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What things you need to remember when buying life insurance

1. All policies fall into one of two camps – There are term policies, or uncontaminated insurance coverage. There are the many variants of whole life, which combine an investment product with pure term insurance and build cash value.

2. Insurance is sold, not bought- Agents sell the vast majority of life policies written in the U.S. because the life insurance industry has a vested interest in pushing high-commission whole life insurance policies.

3. Whole life is expensive – Policies with an asset component cost many times more than term policies. As a result, many people who buy whole life often can’t afford an sufficient face value, leaving themselves under-insured.

4. Whole life policies are built on assumption – The returns quoted by the agents are simply guesses not reality. Some companies keep these guesses of future returns on the high side to draw more buyers.

5. Keep your investing and insurance strictly separate- There is better spaces to invest without the high commissions of whole life policies.

6. Buy sufficient term coverage to fill your necessities – Life insurance is no set to skimp, especially with rates at historic lows.

7. Compare the terms of the policy to your requirements.

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This entry was posted on Wednesday, April 14th, 2010 at 8:25 am and is filed under Life Insurance. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

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