Most people purchase life insurance as a means of financial security for loved ones after an unexpected loss. Proper life insurance coverage can also help pay off mortgages or debts after death. Finding the right coverage can be a challenge, especially in today’s market littered with all sorts of insurance packages. It’s normal to be confused about buying life insurance. It goes without saying that you should not buy the first life insurance policy you see on TV. The best way to safeguard your family’s future is to be well informed. If you are currently shopping for a life insurance policy, consider these questions first:
Do I need life insurance?
Everyone hopes that they will stay healthy and live past 80. That means no one really wants to think seriously about buying life insurance. “Hi, let’s talk about your death” isn’t the most attractive sales pitch either. Before buying life insurance, just like purchasing any other product, you need to ask yourself if you really need it. Common wisdom is that, if you have a family that depends on you financially, then you should consider getting covered. We can’t predict what happens to us. On the other hand, if you are 75 and all your children are now grown up with stable jobs, there’s no point in getting life insurance.
What type of coverage is right for me?
Once you’ve decided to buy life insurance, you need to figure out what kind of policy to buy. First, you’ll have to assess your needs. For example, do you want life insurance to pay off student debt without burdening your family? The policy you buy should have the riders that you require. You can do basic research online using sites such as Accuquote.com, FindMyInsurance.com or LifeInsure.com. Don’t rush to buy the first package you see. Compare quotes patiently. You should decide if you want to buy whole life or term life insurance. Whole life policies have cash value, but are very complicated. Term life insurance is by far the cheaper option and is best suited for many. So how much insurance would you need? A simple rule is 10 times your current income.
Should I hire an insurance broker?
Many companies nowadays offer consumers the option to buy directly from them. At first, it may seem easier to get a policy straight from a company instead of accumulating extra charges with a broker. However, having an independent insurance broker can work wonders for you. He or she can expertly assess your needs and direct you to multiple insurance packages. They can get you discounts, riders and perhaps even lower premiums. If you decide to hire an agent, make sure they are licensed and that they are independent. Some agents take commissions from companies to make clients buy certain products. Be aware of that beforehand. Also, ask your agent upfront how much he or she will be charging you.
Get accurate rates
Do not listen to what others say; you can bargain for better rates. But first, you need to get accurate rates for the policy you want. If you are buying directly from a company, make sure you don’t end up paying for riders you don’t need. If you are using an agent, don’t expect them to fully disclose their commissions. As mentioned above, you will have to confront them about exact numbers. As a general rule, only buy coverage from finance companies with high credentials. You can compare agent or company rates with instant quotes that can be obtained freely online.
You must ask these questions before you finalize your life insurance purchase. Remember, life insurance becomes more expensive as you get older. Buy it while you are still young to keep premiums low, but don’t rush and mess up.