The time has arrived. You pop online and get bamboozled with options. Your eyes start to blur from reading all the jargon and suddenly, you jolt awake, realising all the information you were reading on life insurance got lost when you clicked on that YouTube link of this video your friend sent you hours ago.

All you’re left with is a cramping neck, and that lingering reminder that you need to sign up for life insurance.

To help you out with this procrastination mess you have found yourself in, we’re going to lay down a few helpful tips for choosing the right life insurance.

You know, just so you can get your head together and carry on ‘adulting’ in the best way possible.

Underestimating Your Insurance Needs

If you’re picking a number out of thin air when asked how much you want your beneficiary to claim, you’re doing it all wrong.

Smart Assets gives us a breakdown:

There are several factors you’ll want to consider when calculating how much life insurance you need. These include your age, overall health, life expectancy, your income, your debts and your assets. If you’ve already built a sizable nest egg and you don’t have much debt, you may not need as much coverage. On the other hand, if you have young children and your spouse doesn’t work, you’ll need enough insurance to provide for them financially over the long-term.

The other big mistake you want to avoid is underestimating the value of a non-working spouse. Even though you won’t need life insurance to replace lost income, the money can still be helpful if you need to cover added expenses, such as child care or housekeeping help.

Focusing on Price

In some cases, the cost of buying life insurance may be enough to scare you away. But it’s not something you can afford to skimp on. When you’re looking at the different types of policies, it can be tempting to reduce the coverage amount so you can score a lower premium. But don’t do it:

While you’ll be paying less out of pocket, you need to think about whether the money you’ll save is really worth it in terms of how your family may be affected. If you’re finding that life insurance is too pricey, you may need to take a look at your budget to see what you can cut back on before you opt for less coverage than you really need.

Waiting Too Long To Buy

Of course, the sooner you buy life insurance, the better. Premiums will only increase as you get older and even if you’re in relatively good health, you’ll still pay more for every year you put it off.

Just check THIS comparison of 1Life insurance deals as an example.

You see, as you grow older you run more of a risk of developing serious illnesses or diseases.

Not being completely truthful

If you aren’t truthful in your quote, you can expect your life insurance premium to be a lot higher than your initial quote. Explains Archstone:

Insurance companies are very good at finding out information about you. They will not only ask for your medical records in some cases, but they will also look up your medical information, motor vehicle records pharmacy history.

They will compare any information in your application against what they find in the three databases mentioned above.

They will also have the information from your paramedical exam to review as well. It is best to be as truthful as possible on the application.

If they all add up, a company can decline you if they found out you weren’t truthful on your application. They can also contest your death benefit if they found out you weren’t truthful on your application died within two years of owning the policy.

Selecting the wrong beneficiary

Selecting the person to inherit your life insurance can be daunting. First off, if they are underage, they will have to be appointed a guardian before they can benefit. In addition they might not get a guardian of whom you approve, which means all that money might go to waste. Think Lemony Snicket.

Then there’s the case with naming an estate as your beneficiary. Check:

If you designate your estate instead, your estate’s beneficiaries won’t receive the policy benefits until after the legal probate process finishes. This process can take months or years if your estate is complicated. The policy benefits can also then be vulnerable to creditors.

Also, it’s important to change the name of the beneficiary when life gets in the way, like after a marriage, divorce, birth, and death. Makes sense.

I hope you feel a little better about starting your long relationship with life insurance. Check in with 1Life, who will help you with whatever you need – even advice on what to do when you go away on holiday.

[source:smartasset&wealthpilgrim]