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Education Centre Avoid These Common Life Insurance Mistakes
Education Centre Avoid These Common Life Insurance Mistakes
Avoid These Common Life Insurance MistakesWhile no one likes to think about needing life insurance, the fact is that most of us will need this type of coverage at some point in our lives. When it comes to shopping for life insurance it is just as important to know what to avoid as it is to know what to look for in a policy. Being aware of some of the most common mistakes will help those in need of life insurance obtain the highest level of coverage for the best possible price.Perhaps the most common mistake life insurance shoppers make is purchasing the wrong amount of insurance. Being underinsured can leave your family in financial danger following your demise, while buying too much insurance could mean wasting money that could be put to better use elsewhere. Striking the right balance can be difficult, but it is important to get this basic decision right. For many buyers the purpose of life insurance coverage is to provide their family with an income in the absence of the family breadwinner. Replacing the policyholder’s income can require quite a lot of money, and it is important to run the numbers in order to ensure that the funds from the death benefit will truly last as long as it is needed. A good rule of thumb is to purchase a policy with a death benefit equal to at least 20 to 25 times your annual salary, but these figures will of course vary from individual to individual. |
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