Life Insurance - How Much Are You Willing To Pay?
What would you say if I told you that you could choose how much you pay for life insurance coverage? Most agents want to sell you the largest policy possible because commission is based on the amount of premium sold. However, here at Pivot, our and my concern isn’t about selling you the most amount of insurance possible; it is about doing what is right for you. Part of what I help people with, is determining how much life insurance is appropriate. Another is finding the amount of insurance you can afford. What some of what my clients have done most recently is what is known as a “will buy”.
I hear a lot of reasons why people don’t end up applying for/buying a life insurance policy. The two most common themes of why people don’t apply are either they don’t like me (which is never the case but I have to acknowledge that it is possible) or it’s the money. Whenever you make a purchase that isn’t in your normal spending, you have a pretty good idea of what you’re willing to spend for it. You know how much you can comfortably afford and how much paying would hurt, but would still be doable. When it comes to life insurance coverage, something is always better than nothing. Although it’s nice to have, not everyone needs a $1,000,000 policy.
People like round numbers. I typically quote people on 100,000, 250,000, 500,000, 1,000,000 dollar policies. Not many people ask me what a $289,451 policy costs. A “will buy” insurance policy amount will give you an odd amount of life insurance because a “will buy” answers exactly what the name suggests; it tells you how much insurance a predetermined premium will pay for.
This approach can help everyone. It doesn’t matter if you’re a smoker, overweight, young, old or in perfect health. Yes, your health affects your rating, but regardless of rating there is probably a dollar figure that you are willing to spend. Your budget and your rating work independently of each other. A smoker and nonsmoker will pay vastly different prices for the same amount of insurance. However if what a smoker and nonsmoker could afford to spend a month on life insurance is $20, both could pay that and have coverage. In this instance, it is the amount of coverage each would have that would vary.
About the author: Anthony Veloso has been in the life insurance business for over 2 years. He enjoys coaching football, playing outside with his dog, and taking day trips with his wife and newly born daughter. Anthony is a strong supporter of Orphanages and Battered Woman’s shelters. He would love to put his experience to work for your family to ensure that you have the right life insurance policy. You can contact Anthony at 1-800-654-1953 or AVeloso@Pivot.com.