Some people may think life insurance is simply a bet. While this may be a morbid bet, this is how some approach life insurance. This isn’t a risk worth taking, as it will be your family who suffers in the end. Keep reading to find out more about your options.
Term life might be the cheapest insurance, but keep in mind that it does expire. In fact, one of the only advantages of term policies is that they are much more affordable than other types. Whole life policies are permanent assets, though, and you can even borrow against them. In contrast, term life insurance lasts only as long as you keep up the payments.
Before you purchase any type of life insurance, the first step should be figuring out how much money you need. By over-buying insurance, it could become costly and by not buying enough, you could leave the family with pointless financial stress. Make educated decisions to get the best out of life insurance.
Go to a financial adviser, instead of a broker, to purchase life insurance. Most insurance brokers are motivated by the commission that they earn by selling policies. However, financial advisors are paid a regular fee for each policy sold. Therefore, financial advisers have no reason to be dishonest with you as they offer recommendations about your policy.
Before you secure a policy of life insurance, you should work on improving your health. Life insurance is not typically inexpensive. If you do not have good health, it can cost even more. Prior to taking out a policy, focus on becoming more physically fit. Take the time to lose some extra weight and find ways to eat right. See it through, no matter how hard it is. That will cut your costs significantly.
Your life insurance premiums could substantially increase if you happen to work in a hazardous environment or partake in high-risk extracurricular activities. Consider whether the enjoyment you get from high-risk activities such as skydiving is worth the higher life insurance premium rate. Traveling to risky areas around the world could also make you ineligible for discounts.
Think about getting life insurance if you have dependents that financially rely on you. In the event of your untimely death, life insurance can assist your spouse with the mortgage on your home or allow your kids to attend college.
Don’t pay commissions that are extremely high when purchasing life insurance. Premiums can rise significantly if agents and brokers fold their fees into premiums that you will be paying. You may be able to find a company that offers insurance without an agent’s commission being added to it. If so, this will lower your premium.
Don’t waste time with the “guaranteed issue” insurance policies if it is possible. Life insurance that are classified under this category are mostly geared towards individuals who have pre-existing conditions when it comes to their health. You won’t have to have an exam, but the premiums will be much higher and the coverage will only be available in limited amounts.
Life insurance isn’t something that should be looked at lightly. However, this topic is too important to your loved ones’ security to make it sound trivial.