Thinking about purchasing a term life insurance policy but aren’t sure where to start? Getting life insurance is an important step in supporting the financial security of your family and loved ones. To help you get started, here are our top 3 mistakes to avoid when shopping for term life insurance coverage.
Mistake #1: Not understanding how term life insurance works.
It’s important to have all the facts before choosing the policy you need. There are two basic parts to a term life insurance policy: the policy amount and the term length. The policy amount is the amount of money your beneficiary or beneficiaries would get in the event of your death. The term length sets the period of time during which the policy is effective. Each policy amount/term length combination has a corresponding premium, which is the amount you pay for your coverage. (Want more details? Check out the Direct Auto & Life Insurance Life Insurance Learning Center.)
Mistake #2: Thinking you don’t really need life insurance.
You might think you don’t really need life insurance, but if your passing away would leave behind significant costs that would be difficult for your loved ones to pay for out-of-pocket, you should consider life insurance as a way to help with those costs. These might include unexpected medical bills, funeral costs, car payments, rent, mortgage payments, and education costs.
Mistake #3: Thinking you can’t afford term life insurance.
Many people write off term life insurance as a luxury they can’t really afford, but the potential cost of life insurance could come out to well under a dollar a day. With Direct’s 12-month term policy, for example, $15,000 worth of coverage only costs $0.46 per day. That’s as simple as giving up one cup of coffee or candy bar per day!
Need more help getting started? The Direct online Life Coach can help you figure out whether term life insurance could help you, and how much you might need.
Individual term life insurance by Direct General Life Insurance Company, Nashville, TN. Policy 58TL02010713. Premium and other terms will vary by state, the insured’s age, and the selected coverage.