Insurance World

Insurance is meant to protect you. But scams out there can make buying insurance dangerous. These schemes can cost you hundreds or even thousands of dollars, and leave you and your family without vital insurance protection. Here’s what to watch out for:

Scams

• Steal your premiums-An agent takes your premium check but doesn’t buy you the promised insurance. Instead, the agent steals your money. You aren’t protected, and may not know this until you make a claim.

• Sliding-An agent secretly slips extra features into your policy (such as motor club membership, legal defense coverage, accidental death coverage, guaranteed renewable life, towing coverage). Hidden “extras” that may be worthless can add up to $200 or more to your premium.

• Churning-You’re conned into dropping a perfectly good life insurance policy and buying an expensive one you don’t need. Example: Cashing out your valuable whole life policy to buy a “better” one. You lose years of built-up cash value and have to start all over again. Seniors, especially, should watch out.

• Fake insurance-You’re sold fake insurance (often from a company that isn’t licensed or doesn’t even exist) such as auto coverage, or health insurance for your business.

Fortunately, you can protect yourself. The Coalition Against Insurance Fraud offers these money-saving tips:

• Call your state insurance department and make sure both agent and insurer are licensed.

• Normally, you should make your premium check out to the insurance company, instead of the agent. Call the insurance company within 60 days to confirm you’re covered.

• Read all insurance documents thoroughly before you buy. Insist that the policy is clearly explained point by point, in plain English. Also have a trusted relative or financial expert review. Demand a point-by-point comparison with your current policy. Do you need this new policy? Is it better than your current one?

• Go slow if the price of coverage seems too low to be true.

• Back off if you get vague answers to your questions, or you’re pressured to “sign up now because this special deal expires today.”

• Never sign a blank insurance form, and get copies of all forms.

• Be wary of door-to-door salespeople or e-mail pitches.

Purchasing life insurance is a big decision, and we all want the best coverage for the least cost. However, money is not the only factor that goes into choosing a life insurance company. Below are five factors that separate best life insurance companies from the average ones. You will want to consider when choosing the best life insurance company, and policy, for you.

First, after you have shopped around a bit, thrown out the definite “no way’s” and decided on a couple of “maybe” candidates, you will want to make sure that the one you choose in the end is both well-established and financially stable. You can find this information from the insurance companies themselves, but you might want to consider asking around, as well. Talk with someone who has used or is still using the company’s services. Research the life of the company, too.

Second, you will want to choose a company that does not discriminate against age or existing health issues. These kinds of discriminations make it almost impossible for people to get life insurance.

Third, choose a life insurance company whose policies will not change and premiums will not increase as you get older.

Fourth, it is important for the life insurance company you choose to have a staff of well-trained and objective insurance agents. You want an agent who is unbiased and will help you find the best policy for you, and not what will make the most money for them.

Fifth, and last, make sure the life insurance company you choose has a policy just for you. Your policy needs to fit both your coverage needs and your budget.

Once you have taken these factors into consideration, you will find the best life insurance company for you. It will take time, so be patient during your search. It will be worth it because you will reap the rewards of safety and security in the end.