For Mark Roberts’ Use: Life insurance is something everyone needs, and most of us will enroll in a policy at some point. But that doesn’t mean it’s your average, everyday purchase! You wouldn’t make any other major financial decision without conducting thorough research, so take the time to make this important decision carefully. As you compare policies, watch out for these common mistakes.

Making assumptions. Many people don’t even bother to shop for life insurance, because they assume they can’t afford a policy. In reality, pretty much everyone can afford life insurance, which is a good thing since everyone needs at least a basic policy.

Relying upon an employer’s policy. Some people have made the mistake of relying upon their employer’s policy, but these types of life insurance can be subject to strict limitations on coverage. For example, your heirs might receive benefits only if you pass away as a result of your work duties. Another pitfall is that the policy might not be portable, so it’s gone if you lose your job. And of course, your employer could cancel the policy at some point as a part of budget cuts. Enroll in your own policy, and you can maintain coverage as long as you’re making the premium payments.

Fibbing on the application. Certain factors, like not smoking, might earn you a lower premium. But because insurers also check Medical Information Bureau reports, any misleading information on your application could result in a denial. Even worse, your beneficiaries won’t receive the payout if you pass away and the “fib” is discovered.

Choosing the wrong beneficiary. This seems like it should be a simple decision, but a variety of legal and tax ramifications can complicate things. Make sure to explore all issues that might affect your beneficiary before naming them.

Underestimating needs. Resist the temptation to simply choose a coverage amount that sounds reasonable. We should perform a needs analysis together, to identify all possible financial liabilities, so that your loved ones are fully covered in the event that something happens to you.

Forgetting to update your policy. Once you’ve chosen and enrolled in a policy, you’re not really “done” with life insurance forever. You should perform a new needs analysis every two to three years, to ensure that your coverage is still suitable for your situation.

Whether you’re shopping for your first policy, or updating your current one, give us a call as you consider life insurance policies. We can help you examine all angles of your situation, and obtain the coverage that truly fits your needs.