Know the Basics of Buying Life InsuranceHow much life insurance coverage do you have? If none is your answer, you’re not alone. Many people put off buying life insurance, which is a big mistake. Learn the basics of life insurance to secure your family’s future.
EMPLOYER COVERAGEThe most generous employer-provided life insurance plans rarely provide more than five years’ salary, and many policies offer less. Would this leave your beneficiaries with enough cash to cover any outstanding mortgage debt, college tuitions and other expenses? The recommended minimum is either 10 years’ salary, or five years’ salary plus enough to cover your current debts and larger anticipated expenses.
WHOLE VS. TERM POLICIESTerm life premiums are about one-quarter the cost of whole life premiums, but with whole life, you build cash value, which you could borrow against or cash out at a later date. In addition, most term life policies can be converted to whole life within a designated time period.
LENGTH OF LIFE INSURANCEThe cost of life insurance premiums generally double for every 10 years of age, with greater increases if your health declines even slightly. If you purchase a 10-year term life policy while you have 20 years left on your mortgage, or while your children are young, you can expect a hefty premium increase after the term expires. Your best bet is to lock in your current rate for as long as you know you’ll need it.
CHANGING NEEDSHaving a child, incurring debt or paying off a mortgage early might require you to change your coverage. Let your agent know when such events occur to adjust your coverage accordingly.
Medical ExamsFor those with busy schedules or an aversion to the doctor’s office, products such as instant-issue and guaranteed-issue life insurance allow you to forego a medical exam. Policies such as these typically cost more, but under certain circumstances, they are a great option.
Call our insurance professionals for answers to your questions and access to a broad selection of products available through our industry-leading partner carriers. As the largest independent personal-lines agency in the state, we have the resources and expertise to tailor coverage to your specific needs, at prices that fit your budget. Call (855) 581-4799.