Life insurance is more important than you will ever know. You may think it is a waste of money while you are young, but that may be when your spouse and children need it most. This article can help you decide which kind of life insurance you need and how much to get.
When creating a divorce settlement that requires one parent to maintain life insurance to keep custody of children, create the insurance policy before signing the divorce settlement. This speeds up the settlement process and insures that any kinks in the making of the insurance policy are dealt with before the custody issues.
Don’t rely on the life insurance plans provided by your employer. The coverage provided by the group term life insurance plans that many employers take out may not meet all your life insurance needs. Also, if you quit your job, you usually can’t take your life insurance policy with you.
You must ask if a potential life insurance policy covers accidental death, as some insurance companies will not cover this. Anything can happen to you, and I want you to be assured that your family will be able to pay for your final expenses. If you are unsure, ask your insurance company.
Before purchasing life insurance, you must understand that insurance is for protection purposes only, which does not include investing. Term insurance gives you protection only, with no savings. Whole life and universal policies offer savings, but they are a lot more expensive, and you would be better off using the cost savings to invest in something else.
Improve your credit score to save money on life insurance. Statistics have shown insurance companies that people with poor credit are at higher risks. Raising your credit score could affect your rates differently depending on which insurer you choose, but it’s always good to get several quotes since every insurer evaluates new policies differently.
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. You need to consider which option is best for you and set up the payment plans accordingly.
Take the time to update your existing life insurance policy when any relevant changes in your life take place. This includes providing additional dependents if you get married, have children, or start caring for an elderly parent. It also includes reducing your coverage if you get divorced or after your children graduate from college. If you’re at an age where your previous dependents are now self-sufficient and have enough saved for retirement, you can cancel your life insurance policy altogether.
Purchase a two-in-one policy if you’re a married person. This allows you and your spouse to be listed on a single policy instead of carrying two separate policies. The premium for a joint policy is often cheaper than the premium for two separate policies. Your coverage would still be the same, but it will cost you far less.
Save money on your life insurance premium by choosing to pay it yearly. Most insurance companies will also give you the choice of paying your premium on a monthly, quarterly, or semi-annual basis. However, when you choose one of these options, you usually have to pay installment fees to cover the company’s extra service costs.
Please don’t buy any life insurance policy without taking the time to compare it with similar policies. Some can be renewed, but one could outlast the others. Likewise, the two policies you compare might provide identical sets of benefits, yet one charges lower premiums than the other. It depends entirely on your needs, so do your research to ensure your life insurance meets your expectations.
When purchasing a life insurance policy, you should refrain from purchasing expensive riders unless you understand and need them. Your advisor may tell you that you should add certain types of riders, but you don’t need them most of the time. Typically, riders do not give you any benefits except under certain circumstances.
Consider your current health when purchasing a life insurance policy. It is less expensive to purchase life insurance at a younger age and in good health than later. Even if you experience health problems later, your life insurance is not impacted if it has already been in place. Trying to buy a policy after a health problem can be much more expensive, if not impossible.
Understanding what you need regarding life insurance is not always easy to determine. Consider your family and your outstanding debts. You should have a policy that provides for these things in the event of your death. Buy a policy now, and then iron out the details of your needs.
Before you purchase a life insurance policy, take the time to investigate the insurance company’s strength in terms of its finances and performance. Your insurance company should have a rating of A or higher from independent agencies known for their research on this subject.
As time goes by, you will want to adjust your life insurance. You will use the same thought process as when you first purchased your policy. What has changed that requires a change in your policy. Maybe your kids grew up, there is less household income, or you have fewer expenses. Whatever the case is, adjustments to your policy are inevitable and needed.
Consider your family’s long-term needs when choosing life insurance policies. You will probably want to provide for your estate for at least a couple of years. Buy a life insurance policy based on a two-year average of expenses. Take into account the health of your family members as well.
As previously stated, life insurance is more important than you will ever know. It is not a waste of money but a wise investment in your family’s security. By taking the advice of the above article, you can properly plan for your spouse and children to make sure they are covered at a time when they need it most.
