In today’s world, scams targeting elderly individuals are becoming more common. It can be difficult for seniors to navigate the overwhelming number of people and organizations trying to take advantage of them. One of the major scams targeting the elderly is the life insurance scam. However, with the right information at hand, seniors and their families can avoid falling prey to these scams. Here are some tips and tricks to protect yourself and your loved ones.
One of the signature moves of life insurance scammers is to start a conversation by convincing customers to pay more for their insurance than they actually need.To avoid this, determine just how much life insurance you need. You can do this by calculating your “obligations” and “liquid assets.” Obligations include your annual salary (multiplied by the number of years you want to replace that income), the amount left to pay on your mortgage, estimated funeral costs, and funds to help pay for children’s college tuition. Liquid assets include your savings and existing college funds. Simply subtract your liquid assets from your obligations, or use an insurance calculator to get your final number.
Scammers are good at building a convincing front, so it’s essential to choose a reputable life insurance company. Do your research and look for established companies with good ratings. You can also ask for recommendations from friends and colleagues or check the National Association of Insurance Commissioners for complaints against the company. If you’re considering a smaller company, be sure to do your due diligence and collect real-life experiences from customers online and in person to ensure that they’re trustworthy.
If you suspect that your broker might be involved in a scam, call the insurance company directly to ensure that they’re receiving your monthly payments. If they’re not, report the broker to the authorities and find a new one.
It’s important to remember that life insurance isn’t always necessary, especially as seniors age and settle their debts. If paying monthly premiums no longer makes sense, consider cashing out the life insurance plan to give yourself more financial freedom in retirement. Determine what’s appropriate for your life circumstances and don’t fall victim to snaky brokers trying to take advantage.