What Should I Look For In a Life Insurance Policy?
Life insurance is not just for people with dependents. If you have your own family, it is advisable that you invest in a life insurance. Do some research on different life insurance policies that will be suitable for you and your family. It is better to research first before talking to an agent, that way you will know exactly what you want to be covered for, and you have an idea on premium costs.
First thing to do is determine how much you need. Things to be considered are debts, college tuition fee for kids, mortgages, funeral costs, and if you have smaller children, daycare costs. One reason to have a life insurance is in case something unexpected happens, your family will be covered by the insurance, at least until they are old enough to attend school.
There are two types of life insurance, term and permanent. Permanent is also called cash-value. Term insurance is a type of life insurance that you buy that will be good for one to 30 years. In case something happens to the breadwinner then the policy will be paid out in full and will be enough to cover your deceased family.
Permanent insurance is an insurance that will be enough to cover you throughout your lifetime. Basically, term insurance is appropriate for young professionals who have financial responsibilities for a specific amount of time. Permanent premiums have higher premiums. There’s a portion of the premium that will be saved or invested, and the insurer is allowed to borrow from the savings.
If you’re planning to purchase term insurance, make sure that it is guaranteed renewability. This will ensure that the policy holder will be covered as long as there is continuous payment for the premiums. However, premium rates may increase over time. In addition, you might want to convert your term policy into permanent policy once it has expired. By doing so, you might be able to avoid going through a medical exam. Keep in mind that you are purchasing an insurance that will last for 30 years. After 30 years, your health might not be as good as how you feel now. Having poor health condition is a reason for insurance policies to deny your application. Having your term policy converted to permanent is an advantage, because you will not be asked to go through a medical exam anymore.
When purchasing a life insurance, whether it is term or permanent, choose the best company you can find. It should be around long enough to cover your policy. If you want to determine the success of an insurance company, look at their ratings. Before going to insurance companies personally, try to get quotations online.
To sum it all up, single people, married people and married people with children, all are advised to purchase life insurance. There are two types of life insurance, term and permanent. Term will be enough to cover financial responsibilities, while permanent will have you covered your whole life. Converting from term insurance to permanent will help you avoid medical exams. So, if you want to secure your future, it is advised to have you and yourself insured.