life insurance agent would know that term insurance rarely pays out death claim. Do you know when you going to die? In 2006, my company paid out over $825 million in death claims. From 1977 to 2006, the company has paid out over $10 billion in death claims. My company never sold cash value life insurance, only term insurance.
You see, life insurance agents will make up every possible reasons to make you buy cash value life insurance instead of term insurance. Why is that? Simple answer: Cash value = big commissions, term insurance = very little commissions. There's an old saying: "If you sell cash value life insurance, you can't sleep. If you sell term insurance, you can't eat." Did you know that most life insurance agents own term insurance and they sell cash value life insurance instead? I can't blame them for wanting to sell cash value life insurance. The company probably pressure their sales force to sell expensive life insurance. When you sit down with a life insurance agent, you should ask what kind of policy he/she has and ask to see it. If they try to sell you a life insurance with a savings plan in it, ask "wouldn't it better to keep my savings separate from life insurance?"
Life insurance agents tend to come back to you to sell you more life insurance policies if you are the client. I seen where one couple had over 10 different life policies on themselves and some more on their kids. That doesn't make any sense to me. Someone is getting rich and the family is left behind in the dark. I believe in doing the right thing for the client by providing the right amount of coverage for the lowest possible cost. I can only achieve that by selling term insurance and help the client invest their money in tax-deferred accounts.
I also believe that you don't need life insurance forever. As you get older, your financial obligations will decrease. Your kids get older, your mortgage is paid off (hopefully before you retire), and you don't have much credit card debt. You are nearing retirement and so, you better have lots of money saved otherwise you will be working for life. So, you going to need to save every bit of money as much as possible. If you still need life insurance when you retire, then dramatically decrease your coverage to $10,000 to cover funeral expenses.
So things to keep in mind when you are considering life insurance:
1) You need to ask yourself why do you need it and who is going to benefit from it in case something happens to you?
2) Term insurance is the best way to go to protect your family. It's even better if you invest your money too in money market accounts, IRA, 401k, etc. Cash value life policies are unable to do this, that's why that when you want to use the cash value, you have to borrow it.
3) Some of you bought life insurance from a family member or from a close friend. You should ask him or her what kind of life insurance does he/she have? It's even better to ask all life insurance agents what kind of life insurance do they have and if it isn't term, ask to see their policy.
You see, life insurance agents will make up every possible reasons to make you buy cash value life insurance instead of term insurance. Why is that? Simple answer: Cash value = big commissions, term insurance = very little commissions. There's an old saying: "If you sell cash value life insurance, you can't sleep. If you sell term insurance, you can't eat." Did you know that most life insurance agents own term insurance and they sell cash value life insurance instead? I can't blame them for wanting to sell cash value life insurance. The company probably pressure their sales force to sell expensive life insurance. When you sit down with a life insurance agent, you should ask what kind of policy he/she has and ask to see it. If they try to sell you a life insurance with a savings plan in it, ask "wouldn't it better to keep my savings separate from life insurance?"
Life insurance agents tend to come back to you to sell you more life insurance policies if you are the client. I seen where one couple had over 10 different life policies on themselves and some more on their kids. That doesn't make any sense to me. Someone is getting rich and the family is left behind in the dark. I believe in doing the right thing for the client by providing the right amount of coverage for the lowest possible cost. I can only achieve that by selling term insurance and help the client invest their money in tax-deferred accounts.
I also believe that you don't need life insurance forever. As you get older, your financial obligations will decrease. Your kids get older, your mortgage is paid off (hopefully before you retire), and you don't have much credit card debt. You are nearing retirement and so, you better have lots of money saved otherwise you will be working for life. So, you going to need to save every bit of money as much as possible. If you still need life insurance when you retire, then dramatically decrease your coverage to $10,000 to cover funeral expenses.
So things to keep in mind when you are considering life insurance:
1) You need to ask yourself why do you need it and who is going to benefit from it in case something happens to you?
2) Term insurance is the best way to go to protect your family. It's even better if you invest your money too in money market accounts, IRA, 401k, etc. Cash value life policies are unable to do this, that's why that when you want to use the cash value, you have to borrow it.
3) Some of you bought life insurance from a family member or from a close friend. You should ask him or her what kind of life insurance does he/she have? It's even better to ask all life insurance agents what kind of life insurance do they have and if it isn't term, ask to see their policy.
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