Mistakes to Avoid When Buying Life Insurance
June 22, 2026 | Eric Baker
Buying life insurance isn’t something most people do very often; some people only do so once or twice in their lives, whereas the average is around 7 times. And most of those occur when they change jobs and a new coverage option becomes available, rather than shopping around for the right policy.
Because it's not a very common occurrence, it can be easy to overlook key details when obtaining a new life insurance policy. A quick decision today can lead to higher costs, limited coverage, or gaps down the road. Understanding the most common missteps can help you make a more informed choice and feel confident that your coverage has you and your loved ones protected.
Keep reading to find the top 7 most common mistakes made when buying life insurance.
7 Common Mistakes When Purchasing Life Insurance Coverage
1. Choosing Coverage Based on Price Alone
It’s tempting to go with the lowest premium, but cheaper isn’t always better. Policies with lower costs may come with limited benefits or coverage that doesn’t fully support your long-term goals.
When purchasing life insurance, it's key to balance affordability with the level of protection you actually need.
2. Not Understanding the Type of Policy
Life insurance is complicated, and many buyers don't fully understand the different types. Sure, you may identify that term life insurance is cheaper because it's coverage for a limited time, whereas whole life insurance costs more because it lasts your entire life (as long as premiums are paid). But there are subsets of these types of insurance coverages and riders (add-ons), and more nuances that not being aware of or understanding could mean you're not getting the best coverage designed for your specific needs.
Working with an experienced life insurance broker like the agents at Twin City Underwriters can help you learn about each type of life insurance, which serves a different purpose, and avoid choosing the wrong one, which can lead to gaps in coverage later.
Download our free life insurance basics e-book and learn about the different types of life insurance policies.
3. Underestimating How Much Coverage You Need
Another common mistake is selecting a policy that doesn’t fully account for future expenses like mortgage payments, debts, education costs, or replacing an income.
How much life insurance you need will vary significantly from one individual to the next. Accounting for any debt, your dependents and the kind of future and financial support you want to provide to others in the event of your passing will not be the same for everyone.
A common rule of thumb for determining how much life insurance to purchase is to cover your debts and aim for 10–15 times your annual income in coverage. While this can be a helpful starting point for working individuals with families, the right amount of coverage will vary from person to person.
When determining how much life insurance to purchase, be sure to think beyond immediate needs and consider long-term financial impact.
Learn More: How Much Life Insurance Do I Need?
4. Waiting Too Long to Apply
The reality is, life insurance premiums increase with age, and health changes can also affect what you pay or even your eligibility to obtain coverage. Delaying your decision can limit your options or increase costs.
But this doesn't mean that seniors automatically cannot get coverage. Working with a professional insurance brokerage that specializes in senior insurance coverage, such as Twin City Underwriters, can ensure you have all options presented to you, so you can find the best coverage at the most affordable price point and get the support you deserve.
Life Insurance for Seniors: What To Consider and Knowing Your Options
5. Not Reviewing or Updating Your Policy
Life changes happen, things like marriage, children, grandchildren, home purchases, property sales, divorce, new financial responsibilities and more. When these changes take place, they can all affect your coverage needs, which is why it's important to review your life insurance policy.
Reviewing your life insurance coverage is often overlooked, and the above examples are the more obvious reasons to revisit coverage, but the truth is, it's good to do every few years, even if major life events haven't happened. Regular reviews help ensure your coverage keeps up with your life and your loved ones are financially protected in the event of your passing.
5 Reasons Why You Should Revisit Your Life Insurance
6. Only Looking at One Insurance Company
Another common mistake is contacting only one company and basing your decision solely on their options and quotes. Working with a life insurance broker can be exceptionally valuable, as they can compare multiple insurance companies and help you get the best coverage at the best rates available.
7. Not Getting Professional Guidance
With modern technology, applying for life insurance can be as easy as a few clicks, but trying to navigate life insurance alone can lead to missed opportunities or misunderstandings. Having guidance can help you compare options and find a better fit. Working with a knowledgeable partner can simplify the process of buying life insurance and help you avoid costly mistakes.
Get Support Making the Right Choice for Life Insurance Coverage
Choosing the right life insurance policy doesn’t have to be overwhelming. With the right guidance, you can find coverage that fits your needs today and adapts to your future.
At Twin City Underwriters, we’ve been helping individuals choose the right insurance for their lives and needs for more than 50 years. When you work with our experienced team, you can feel confident knowing we are dedicated to being a lifelong partner there to help you navigate life’s changes and ensure your coverage continues to protect you every step of the way.
Get in touch today to review your life insurance options and make a confident decision.
Choosing a life insurance plan can be difficult. Working with an insurance broker can help you find a plan that fits your needs. Schedule a one-on-one meeting with one of our life insurance brokers to get your insurance questions answered!