Are you buying life insurance for the first time? You probably don’t even know where to start. It’s no secret that purchasing life insurance for the first time can be a bit overwhelming. Below are some tips that can help make getting a new life insurance policy smoother.
When you are in the market for life insurance, ensure that you purchase enough coverage. You will need your insurance policy to cover debts like your mortgage and any personal loans and cover school fees for all of your children.
Try to lead a healthy lifestyle. The healthier you are, the cheaper your life insurance will be as insurance providers assume you will live longer. Remember, you will be expected to pay a high premium on a life insurance policy for anything that shortens your life expectancy, for example, being overweight, smoking, taking certain medication, etc.
You should review your life insurance coverage needs at least once a year. As your family changes, so do their financial needs. If you have another child, your coverage needs will increase while you might be over-insured as an empty Nester. Check periodically on what you need to avoid paying too much or leaving your family in the lurch.
If you plan on buying a life insurance policy, make sure you purchase sufficient coverage to provide for your family. Financial professionals propose that you calculate this amount by multiplying your yearly income by seven. If you have children, it is suggested that you increase this number to 10.
You should find out about the payment options available to you when signing up for a life insurance policy. Many companies offer customers the ability to pay monthly, annually, or even bi-annually. It would be best to consider which option is best for you and set up the payment plans accordingly.
You need to find out if your life insurance policy is convertible. Some insurance carriers will allow you to transfer your policy to a different policy within a certain time. It is important always to know what options are available to you and to make sure you always have coverage that fits your needs.
The price you pay for your life insurance will depend upon your age, health problems, and smoking status. One way to lower this cost is to quit smoking. Smokers will always pay much more for life insurance. Quitting will save you money on your premiums; you will also be saving money by not purchasing cigarettes.
Even after finding a policy that you feel you, love, you should still compare multiple policies to see if you can find a better deal on any other life insurance package. You never know; you might find the same 20% less per month package. That would be a huge difference in the long term.
If you need more life insurance because of your poor health, you should consider purchasing a rider instead of a new policy. A rider is an addition or change to a current policy. Therefore, a rider is usually not as expensive as purchasing an additional policy, which will keep your premium low.
There are several factors to consider when determining the amount of life insurance you need. The first question you need to ask yourself is whether there is a need for life insurance. If you’re not married and don’t have any children, the answer is no. A good rule of thumb is to purchase between 5 and 10 times your annual salary.
Life insurance policies aren’t just for the elderly. If you are young and concerned about what might happen should something happen to you, it doesn’t hurt to look into it. Being younger, life insurance companies usually offer you the lowest rates because they face a lower level of risk in insuring you.
Use the internet to get quotes for different life insurance policies. Some websites will give you a wide variety of quotes almost immediately after you enter your information. This will save you time and frustration. If you decide on one of the policies, you will have to undergo an application process and a medical evaluation.
Make sure you pay your life insurance premium payments on time. While most companies allow a grace period for late payments, consistent late payments can reduce your available cash value or result in a policy cancellation. Depending on your age and health, getting a policy reinstated or finding a new one could be much more expensive than your original policy.
The question of when to buy life insurance is frequently asked. Since life insurance aims to replace your income in the situation that you die, you should purchase insurance when you have dependents. The type and kind of life insurance will depend on your specific situation and how much money you will need to ensure that your dependents are taken care of.
One tip when purchasing life insurance is always to tell the truth about your health issues. Even if you can make it through the medical tests and reviews done by the insurance company and get the policy issued, it is not a good idea. Insurance companies investigate claims, and if they suspect your information is not valid, the claim will not be paid, and your heirs could be tied up in court for years.
To save money on your life insurance, make adjustments to your policy as your needs grow and change. Good times to reevaluate your policy are after getting married or divorced, having a child, or gaining care-taking responsibilities for an elderly parent or relative. You can forgo life insurance entirely if you have saved enough for retirement and have no one else to take care of.
As you have seen, buying life insurance is not as scary as it may appear at first. Just think of all of the benefits it has and the expenses it can take care of, along with the money it can save you in the long run.
