Have You Made These Life Insurance Mistakes?

PRESS RELEASE, September 2, 2008

It's easy to neglect this cornerstone of your family's financial health. Don't make that mistake. While 81% of Americans say they need life insurance, only 41% own an individually purchased policy.1 Do any of these other mistakes sound familiar?

Mistake #1 Putting it off. There's no doubt about it: The topic of life insurance is an emotional issue. Therefore, it can be easy to put off. However, if someone depends on you financially, it's crucial that you obtain the right amount of life insurance coverage for your family. Talking to someone you are comfortable with – like your Primerica representative – can help.

Mistake #2 Relying on your company-provided plan. Many workplaces offer an employer-paid basic life insurance benefit, usually equal to one or two times your annual salary. Unfortunately, this is usually not enough. And, what happens if you change jobs – or lose your job? Not all policies are portable, and there's no guarantee your employer will provide this benefit.

Mistake #3 Thinking you can't afford it. Term life insurance rates are lower than you might expect. “If you need to buy more, term is almost always your best choice. Compared with a whole life policy, you can purchase more coverage for fewer dollars, and rates have been dropping steadily in recent years.”2

Mistake #4 Not buying enough coverage. How much do you need? That depends on the individual. However, many independent financial experts recommend the following rule of thumb: purchase an amount of coverage equal to six to 10 times your annual gross income.3 If you're still unsure, ask your Primerica representative to help determine the amount that's right for your family.

Mistake #5 Not reviewing your coverage. Financial experts recommend reviewing your coverage every few years, or when changes occur, such as buying a house or having more children.

When was the last time you reviewed your coverage amount? If it's been more than two years, chances are you could benefit from a review. Primerica can help. Visit Primerica Financial Solutions to learn more!

  1. Life and Health Insurance Foundation for Education.
  2. Money, March 2008
  3. INSWeb.com, viewed April 4, 2008