As if buying life insurance wasn’t complicated enough, there are
multitudes of life insurance scams out there, run by criminals just
looking for opportunities to separate people from their money. Not only
do their victims lose out financially, but often learn that they can’t
get legitimate life insurance or their identity has been stolen. So how
can you preserve yourself from life insurance scams?
Know why you are buying life insurance
If you already have life insurance and someone is offering you a
better deal, think carefully about why you would make a switch. Do you
have reason to be dissatisfied with your current policy or insurance
company?
If someone is offering you a fabulous deal that will make you big
bucks, think long and hard and don’t let visions of what you could do
with all that money cloud your judgment. An outrageously good deal is
probably just one more life insurance scam.
Whether you have life insurance or not, be clear with yourself
what your intent for having life insurance is. If you have a young
family, then you want them to be protected if you die suddenly and can’t
support them. If you are older, you might be looking for enough to
cover funeral expenses and care for your spouse. Whatever your goal,
know how much insurance you really need.
Ask questions, think about it, and ask some more
One reason life insurance scams are so common is that buying
insurance can be complicated and many people don’t fully understand what
the terms of their policies are. For example, some life insurance
policies will only pay out after you have paid into it for 15 or more
years. This kind of policy would not be a good option for an elderly
person. Understand what it is that is being offered to you, and any
penalties you would face if you gave up your existing coverage.
