When I first got into the financial services business I worked for a life insurance company. It’s a really well respected company. I thought the need for life insurance was obvious and it would be easy to sell. I was wrong. Here are some reasons I think it’s hard for you to buy insurance.
Life insurance is complicated.
Let’s face it; most people don’t understand life insurance. They don’t understand how it works. They don’t understand why some types are so darned expensive and others seem really cheap.
Today, life insurance is seen as a commodity. You just call up some internet broker and for $35.00 per month you have all the insurance you’re ever going to need. I hope you didn’t just believe my last sentence. It isn’t that simple. That’s why insurance agents exist. They are supposed to be the experts that guide you the labyrinth known as life insurance.
Insurance agents love to use jargon.
Life insurance has a lot of technical terms. Life insurance agents don’t like to take time to explain what each of these terms means. This means that if you’re talking with someone about buying life insurance there’s a chance that you don’t understand what you’re buying. No one wants to buy things they don’t understand.
If you don’t understand the jargon or technical terms, stop the person you’re talking with and make them explain their jargon. You might even learn what makes life insurance work.
You don’t get to enjoy it while you’re alive.
Most of the time the only time life insurance gets paid is when you die. I don’t know about you, but thinking about my death is not the most pleasant activity I do. At the same time knowing how to protect those you love for the time period they need protection is important.
You can buy insurance that lasts for ten years, twenty years, and thirty years or even for your lifetime. You’ll have different needs depending on where you are in life. Having a professional work through these issues with you is useful. There’s a reason that life insurance agents get paid commissions.
You have to think about dying to buy it.
I actually think thinking about your death is a good thing to do. We don’t put together wills, we don’t let our families know what we want when we’re gone, and we don’t plan well for those who are left behind, but we should do all of these things. Life insurance is part of this process.
Dying is not a pleasant experience for most. Do you really want to think about a painful event that ends your life? Those thoughts often come up when I’m having a life insurance conversation with someone. I understand that and try to help you think about dying in a constructive way if that’s possible.
Did I say it’s complicated?
So here’s where it gets to be the eyes glaze over time. You can have universal life, term life, indexed universal life, variable life, or whole life insurance. These are just the general categories life insurance falls under. If you’re not confused yet how about adding guaranteed death benefits, living riders or cash value versus no cash value policies.
Most people I’ve run across don’t want to know all the details of the policy. They just want to know that their loved ones are going to be taken care of. I understand this. When you talk with your insurance agent, make them simplify it for you. If they can’t, there might be a chance your agent doesn’t really understand what they’re recommending.
You don’t want to get taken advantage of.
This is the big one. I doubt you want to buy something only to find that it’s not the right product for you. This can and does happen from time to time. It happens when your agent doesn’t ask you enough questions about what the purpose of the insurance is. Let’s face it, life insurance is expensive. When you buy it you want to know that you’re buying the right stuff.
Next time you read an article on how easy life insurance is and how it’s become a commodity, just think about to the reasons you haven’t bought it. You might want to find someone who’s competent and can help you think through what your needs are. It’s what I would do.
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