Planning for your financial future might mean that it’s time to start thinking about getting life insurance. After all, your financial legacy will remain long after your own death, and you naturally want to protect your loved ones, no matter whether you die at 30 or 80. Life insurance is there to help you deliver on that promise.
Still, getting life insurance is different from enrolling in other policies like auto or homeowners insurance. It deals with your own life expectancy, and is directly tied to your risk of death. Therefore, to get the right benefits, you’ll want to follow a special process to ensure you cover all your bases.
Examine the Types of Life Insurance Available
Life insurance comes in numerous forms, and one of them might be better for you than the other. There are two primary types of coverage (though they each have many subcategories).
• Term life policies only last for a certain number of years. They provide a death benefit when you die. You must enroll in a new policy once the term expires to continue coverage.
• Whole life policies can last for the rest of your life. Among their benefits is their ability to accumulate cash value. The cash value usually accumulates in addition to the death benefit, and you can use the cash value as a source of income later in life.
Both policies are tailorable to the individual client’s needs. Work with your agent to determine which type of plan is best for you, based on factors like your age, overall health, finances and more.
Determine the Value of Your Policy
Your life insurance’s primary benefit is the death benefit, which is the sum paid to your survivors when you pass away. You want to match your death benefit as closely as possible to your financial goals.
For some people, this means linking the death benefit to a certain expense like a mortgage or child’s college tuition, which you might want the death benefit to cover on your death. Others choose to link their policies to their own income, and provide a value based on several years’ worth of paychecks. Everyone is different, so your agent can be a valued assistant in helping you pick the right benefit.
Understand The Enrollment Process
You will have to provide certain information to your insurer to enroll in coverage. Among these might be personal information, tax returns and even a medical exam. These factors help the insurer gauge your own risk factors and determine your premium.
Medical exams often help insurers determine your overall health and eligibility for coverage. It is usually quite simple and relatively non-invasive. Often, the better your health, the lower your policy prices might be. Never skip taking the medical exam if you have that option.
Your insurance agent can help you determine the best coverage and policy for you. So, don’t wait. It’s never too early to get life insurance.