Should I accept ‘free’ life insurance from my bank?
I’ve been getting a lot of these solicitations from my bank about free Group Accidental Death and Dismemberment Insurance. I can get $3,000 in free coverage. Getting “free” money or protection always seems like a good idea but, I wonder what the bank is getting out of it. Is the bank taking life insurance out on me too or is there anything else I should worry about before I take this freebie?
Carmen Wong Ulrich Nov 10, 2013 Former Host
Didn’t your mama tell you that nothing in life is free? She was right! What does the fine print say?
Banks many times send us letters informing us of some change or product but offer little insight into how said product or change really works. This may get you into the door, but only to find yourself upsold into something that costs more money. For example, I just got a letter from my bank regarding the number of transactions in my business account, informing me that I now qualify for a different kind of account. But, no further information. Instead, a plea to “see your local X banker,” surely to upsell something. I’m the wrong lady for that letter!
You can assume that in the end, this policy will not be free. Most likely you’ll be required to purchase another kind of policy or be asked to get more coverage, for a cost. Insurance coverage comes with some juicy commissions so it’s a product that tends to get sold, hard. Get informed on what insurance you really need and what kind. This way, when you do need the coverage, you’re less likely to cave to pressure. For more information on what insurance coverage works for you, head to the site of the Insurance Information Institute.
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