4 Common Mistakes When Buying Term Life Insurance

Buying term life insurance might seem overwhelming at times, and many people are afraid of making a mistake when purchasing term life insurance coverage. These are the top four common mistakes when buying term life insurance: 1) Automatically choosing the cheapest policy, 2) not buying enough coverage, 3) not buying the right term length, and 4) lapsing between policies. Read our guide now to avoid the most common mistakes made when buying life insurance so you can buy your policy with confidence.

Ready to compare quick life insurance quotes?

Your life insurance quotes are always free.

 Secured with SHA-256 Encryption

Tim is a licensed life insurance agent with 23 years of experience helping people protect their families and businesses with term life insurance. He writes and creates stuff for QuickQuote and other insurance and financial websites.

Full Bio →

Written by

Benjamin Carr was a licensed insurance agent in Georgia and has two years' experience in life, health, property and casualty coverage. He has worked with State Farm and other risk management firms. He is also a strategic writer and editor with a background in branding, marketing, and quality assurance. He has been in military newsrooms — literally on the frontline of journalism.

Full Bio →

Reviewed by Benji Carr
Former Licensed Life Insurance Agent

UPDATED: Jul 19, 2021

Advertiser Disclosure

It’s all about you. We want to help you make the right life insurance coverage choices.

Advertiser Disclosure: We strive to help you make confident life insurance decisions. Comparison shopping should be easy. We are not affiliated with any one life insurance company and cannot guarantee quotes from any single company.

Our life insurance industry partnerships don’t influence our content. Our opinions are our own. To compare quotes from many different life insurance companies please enter your ZIP code above to use the free quote tool. The more quotes you compare, the more chances to save.

Editorial Guidelines: We are a free online resource for anyone interested in learning more about life insurance. Our goal is to be an objective, third-party resource for everything life insurance-related. We update our site regularly, and all content is reviewed by life insurance experts.

Buying term life insurance might seem overwhelming at times, and many people are afraid of making a mistake when purchasing coverage. Below are some common mistakes to avoid when researching and buying a term life insurance policy.

Buying the Cheapest Policy

Many people go straight for the lowest priced policy rather than the one of most value. Before selecting the least expensive product, you should consider the financial strength of the company and the product’s features including the length of the guarantee period, convertibility rights, and available riders. Usually, for a little extra money, you can buy a policy with better features, more flexibility, and from a company with superior financial strength. Luckily, shopping through a term life website makes it easy to compare term life insurance rates from top-rated companies quickly.

Not Buying Enough Coverage

Most experts recommend purchasing a policy with a death benefit equal to 10 times your salary. However, everyone’s needs are different. You should take into consideration your annual income before taxes, how much your dependents need and their current age to get a better estimate of your family’s needs. Use a free Term Life Insurance Estimator to help determine how much coverage to buy.

Not Buying for Long Enough

If the purpose of the insurance is to provide coverage for a specific period in your life, then your policy should allow you to maintain the coverage at a guaranteed rate for the period you require. For instance, if you’ve just had a child, and you want to ensure that he or she will be taken care of for the duration of their youth, you should consider a 20-year guaranteed level premium product. If you buy a shorter term guarantee and intend to renew, check to see what the renewal rate will be. Chances are it will be more expensive to renew than purchase the term length you need as you will have aged some and the prices are likely to go up with time.

Allowing a Lapse Between Policies

Sometimes it is necessary to switch life insurance policies or companies. But before dropping an existing life insurance policy make sure the new one is in force. It is important to remember is that some life insurance coverage is better than having no coverage at all.

Buying term life insurance is one of the most important financial decisions you can make. You and your family deserve the protection and the peace of mind that term life insurance can offer. Before making your decision, be sure to consult with a licensed agent who can walk you through the process and help you choose the right company for you.

Ready to compare quick life insurance quotes?

Your life insurance quotes are always free.

 Secured with SHA-256 Encryption

QuickQuote is a BBB Accredited Business. BBB