Common Ways Agents Try to Sell Life Insurance

Life insurance agents sell life insurance; that is their job and how they earn a living. For the most part, life insurance agents are very ethical and honest business people simply trying to sell a product to the public at large. Furthermore, life insurance is indeed a financial product that everyone should consider. However, you should be aware of the ways a life insurance agents goes about trying to sell you a policy.

Selling you the “Permanent” Life Insurance Solution

Although most life insurance agents and will write you a term life insurance policy, it is usually not their first choice. The longer you keep your life insurance policy, the more money the agent will earn in commissions and bonuses from the life insurance company. Term life polices tend to be canceled when policyholders find cheaper rates at another company or for many other various reasons.

However, when agents are able to sell you a whole life policy, or a life insurance policy that builds cash value over time, cancellations and moves to new companies are not nearly as frequent. Therefore, the agent has a vested interest in trying to sell you a whole life policy rather than a cheaper term life policy. When trying to sell whole life policies, many insurance agents will tell you that a term life policy is simply a temporary life insurance solution. While pro-life policies don't do any cash value, they paid death benefits does the same as a whole life policy does and are considerably less expensive.

Selling you a Lifetime Savings Fund

When trying to sell whole life insurance policies, life insurance agents will usually explain to you that cash value policies offer dividends and act as a lifetime savings fund. However, you should be aware that whole life policies, or cash value policies, are not the same as a savings account or even an investment account. If you surrender your whole life policy within the first 10 years or so, you will forfeit most of the value of the policy.

Generally speaking, you are much better off by investing in a well-managed mutual fund or even investing in a certificate of deposit. Many investment experts consider whole life policies one of the poorest ways to invest your money, and the added expense of whole life policies versus time life policies will usually only tie up money that can be much better invested in other ways.

Selling you with Guilt Association

The selling strategy for many life insurance agents is centered around guilt. Most life insurance agents know that by making you feel guilty about not preparing and planning for the support of your family and loved ones, that they can more easily persuade you into purchasing a life insurance policy. In fact, if you were to ask many life insurance policyholders why they have a policy, almost all of them will tell you that they want to look out for their family in the event something happens to them.

While purchasing a simple term life policy to provide for your family is always a good idea, don't let the insurance agent guilt you into purchasing a policy that you cannot afford or one that doesn't make sense for your present financial situation or circumstances.

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