Dispelling Common Life Insurance Myths
UPDATE 4/14/2012 - While this blog entry does mention negotiating life insurance rates as a myth, there could be some opportunity to get lower rates from your insurer. If you do your homework and learn there are more affordable options out there for your life insurance needs, letting your current provider know this could prove to be beneficial. The life insurance industry can be competitive, and there is a chance your agent will have options available to offer you to try and keep your business. It can't hurt to try, and if there really are better options out there for you, then you can switch and save the money you deserve.
There is a lot of life insurance information out there and it's important to know you have accurate facts before making any decisions. Life insurance can be very complicated, but with the right time and dedication you can become an expert and be confident you are making the best choice for you and your family.
The Cincinnati News website talks about some of the popular myths confusing consumers in J Brendan Ryan's article "Let's Dispel Those Life Insurance Myths". The first misconception is that most policies can be negotiated. Ryan points out that the life insurance agent typically represents the insurer and they are only authorized to sell certain products. While consumers tend to haggle for cars, houses and other big ticket items, it doesn't necessarily work that way with life insurance.
Another myth floating around, especially online, is that life insurance quotes received on the Internet are cheaper than visiting a local agent or calling an insurance company directly. There hasn't been much evidence of this being true, and often times, when you speak to an actual person, they can set you up with a policy that fits your needs best and that could end up saving you more money. It just depends on your individual situation. That isn't to say online quotes are valuable. They are quick and can offer simple tools for comparison shopping so it can be beneficial.
The last myth discussed in the article has to do with cash value. Often times the cash value of life insurance policies gets miscommunicated to customers and they believe they are borrowing their own money when taking against the cash value of their life insurance. The truth is that the value belongs to the insurer and is used as part of the reserve to keep your future policy premiums in check as well as to pay for any death benefit distributed. This is why interest is typically charged when you borrow against your policy.
Your best option in most cases is to talk to an expert and be sure you understand fully the terms of the various life insurance quotes you receive. Knowing you've made the best choice when purchasing your policy will give you the peace of mind you need during tough times. Reputable companies such as Hartford Life and Aetna Life Insurance are known for giving accurate information with quality products.