7 Costly Mistakes Seniors Make When

7 Costly Mistakes When Buying Final Expense and Life Insurance

Disclaimer: the seven mistakes listed below are not always disadvantageous for the clients who have them assigned in their policies. Critical long and short term planning should go into preparing for your financial future; therefore, there are times when it is appropriate to have one or all of the features listed in this report. Please seek professional advice. Lic # of83362

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“7 Costly Mistakes Seniors Make When

Buying Final Expense and Life Insurance”

If you are reading this, it is because you or somebody you know is thinking about purchasing final expense or life insurance. The cost of funeral/burials currently averages between $7,000-$10,000 and these expenses increase on average 3% every year. Without thoughtful preparation, these final expenses could become a financial burden on those you love and care for.

Preparation can sometimes feel daunting. How do you know which plan is best for you? How do you know you aren’t being scammed or hoodwinked in some way? To help you make this important decision, we have created this informative report.

In the next few pages you will find the 7 most costly mistakes seniors make when purchasing final expense and life insurance. Each mistake is extremely common and without careful examination can easily be overlooked. It is YOUR responsibility to notice them because the company will certainly never point them out.

7 Costly Mistakes:

Mistake #1: Purchasing through the mail

The #1 most costly mistake people make when buying final expense and life insurance is… via mail order. Purchasing through the mail is no doubt easy and convenient but the risks are tremendous.

Often, when you buy through the mail it is difficult to understand what you are getting. Brochures are vague and fine print in abundant. On the other hand, when you buy through a license professional has its advantages. The agent can sit down with you to help you understand your policy, answer your questions, and provide sound advice that applies to YOU.

Mistake #2: Waiting Periods

Most plans that are purchased via mail have a 2-3 year waiting period before the policy is in full effect. That means, if the insured should die in the first 2 or 3 years, the beneficiary will only receive, as a death benefit, what the owner paid into the policy plus a very small percentage (usually 10% or less).

Why do companies do this? They do it because when you buy through the mail, they don’t know if the applicant is healthy or not. The person applying for coverage could be terminally ill, therefore guaranteeing they will loose money on the policy and companies don’t like guaranteed loss. Therefore they make everybody wait 2-3 years.

Mistake #3: Buying plans with increasing premiums

Many unsuspecting seniors have fallen prey to this type of policy. They buy it at an unbelievable low rate and then suddenly the monthly payment begins to increase. Sometimes it takes several years before this begins and at first glance the increase does not seem significant. As time goes on it gets worse and soon… they are unable to continue with the policy because their premiums are too high.

Increasing premiums are often found in mail order and term policies. They can increase in all different time periods as well. Most mail order policies increase every 5 years while most traditional term policies increase every 10 or 20 years. As a senior, generally speaking, you should avoid these types of policies; however, THERE ARE TIMES WHEN THIS TYPE OF POLICY IS APPROPRIATE AND IN THE BEST INTEREST OF THE CLIENT.

Mistake #4: Coverage Reductions

As mentioned earlier, the prices of funerals go up 3% every year. So why would a company give a policy with a death benefit that decreases? Imagine having a $10,000 policy and thinking your final expenses are taken care of; then on your 75th birthday you receive a letter from your company stating that your coverage will be reduced to only $5,000. How frustrating, but it happens all the time. Now that is an expensive mistake.

Mistake #5: Coverage Cancellations

This is by far one of worst and most inconvenient surprises people find on their existing policies. Many are lead to believe that they will have their final expense and life insurance policy until the day they die; however, it doesn’t always work out that way. Many policies only provide coverage to a certain age (usually 80 years) and once you complete that age… the insurance company sends them a lovely ‘Dear Jane’ letter saying their “coverage has been terminated under the terms and conditions of the policy.” When this happens, many times you don’t get ANY money back. So you paid in all that money and you receive nothing in return. Although it doesn’t seem fair, if the policy states it in the terms and conditions, they can legally do it.

Mistake #6: Accidentally Buying Accidental Insurance

Many are surprised to find out that accidental insurance and death insurance are two different things. Always remember, accidental policies ONLY pay in the event of an accidental death. If you die from natural causes such as heart disease or old age, then your beneficiary receives NOTHING.

Accidental insurance is icing on a cake, it’s nice to have but not necessary. It is more important to have regular final expense or life insurance because it will pay regardless of cause of death. On the other hand, accidental policies rarely pay death benefits. Coverage is so inexpensive that companies will stop at no end to avoid paying a death claim.

Mistake #7: Not working with somebody they trust

All of these foul follies can be avoided if you simple work with somebody who is knowledgeable and trustworthy. You need somebody who is willing to give it to you straight, so there are no surprises at time of death. She/he should be licensed, experienced, and represent an established company with a good track record and a high S & P rating.

There you have it… the 7 most costly mistake seniors make when buying final expense and life insurance. Hopefully you found them informative and helpful. With them, you will have the tools necessary to make a good buying decision when preparing for your future and the future of those you love.

As mentioned earlier, the time to prepare is now. To receive a FREE Confidential Coverage Review, Planning Kit, and a copy of this report, please call 1-866-992-8683 and leave your name, address, and phone number.