Life insurance is an important insurance product and all adults should have at least one policy. Most people know that they need life insurance, but first time life insurance buyers are often overwhelmed and confused and don't know what type or what size policy to purchase. If you are a first-time life insurance buyer, use the following tips.
Determine the Amount of Life Insurance that You Need
Life insurance is designed to be a financial safety net for your family in the event of your death. Everyone's life insurance needs are different, so you need to consider your own unique situation when figuring out what size policy that you need. If you are relatively young, married, have young children, and hold a mortgage on a home, you will need a much larger policy than someone who has just retired, has no minor children, and does not have a mortgage. A good rule of thumb is to ensure that your life insurance policy can replace your yearly income for as long as your children are minors.
Research What Type of Insurance is Right For You
You can opt to buy either whole life insurance or term life insurance. Whole life insurance is a permanent form of life insurance that offers comprehensive coverage, but the premiums can be quite expensive. Term life insurance provides coverage for a set period of time, such as 10 or 20 years. When your term life insurance policy ends you are no longer covered, but the premiums tend to be much more affordable than whole life insurance.
Consider the Insurance Provider
When you begin shopping around for life insurance policies, you will most likely receive a number of quotes from dozens of companies. When you see an attractive quote, take the time to find out as much as possible about the insurance company providing the policy. It is in your best interest to purchase life insurance from an established insurance company that has a track record of good service. The last thing you want to do is waste money buying a policy from a company that is unstable or has complaints from other customers about not paying out on valid policies.
Talk to a Financial Adviser
Speaking with a financial adviser can give you a better view of your financial situation and help you determine whether or not the size of the policy that you are considering buying is the right size. Sometimes a larger policy may only cost a few more dollars a month, and your financial adviser may see things in your finances that show that a larger policy would benefit your family if you were to pass away.
Contact a company like Woodmansee Insurance Inc for more information and assistance.
After we had kids, we realized that we needed to up the ante on our insurance coverage. While we had a policy in place, I knew that we had to do something to make sure that we were protected in any instance, which wasn't the case at the time. I began talking with different brokers about what we could do to improve our coverage, and they had some really great suggestions that seemed to help. This website is here to help other people to know how to purchase insurance, and what kinds of policies would work best for your special family.