With the sharp decline in stock prices over the past two years combined with the real estate market implosion, most people are searching for the most cost-effective way to protect their families. The benefits of term-life insurance shine brightly in times like these.Do you want to learn more? Visit McEvoy Insurance & Financial Services
But if you inquire around, there’s no idea from many people how amazingly inexpensive it is to purchase term life. Dollar for dollar, there is no other financial commodity in the world at such a low cost that does what it does. Here are five steps you can use to make smart choices about your family’s purchase of life insurance cover.
Phase 1. Start Know what you get.
Term life insurance at the most basic level is pure and easy security with long-term benefits that will give the beneficiaries a substantial amount of money should you die. Although the financial services industry provides a variety of other forms of insurance packages with several forms of major extra benefits, only term policies eliminate the premiums incurred by certain other schemes.
Stage two. Decide which insurance you need.
Nearly half of our country’s employees have no life insurance, other than what their employer provides them with. This is usually only a nominal amount of maybe 1 x their annual sales.
Using any number of online calculators it is easy to find the correct amount of coverage you may need. Some calculators will simply take your annual income and multiply it by the number of years that you want cover to come up with the suggested insurance coverage sum. Many, more sophisticated calculators ask more detailed questions such as when you want to pay off your mortgage or when you think your kids are going to start college, etc. Using these kinds of variables the calculator will give you a recommended amount of coverage that is relatively accurate.
Know, there’s no second chance to buy the right amount of life insurance when you die! Take this step carefully and your family will be in good shape.
Move 3. Proceed. Decide how long coverage you will need for.
Ideally, the policy shouldn’t expire until you need it. For example, if life insurance is meant to offer coverage over a limited duration of your life, such as when your children finish college, and your youngest child is 5 years old, then life insurance policy should last for at least 20 years.
Know you’ll never be as young or happy as you are now. Locking in the lowest rate for the longest period of time is always a smart idea.
Stage four. Shop around.
In insurance industry we all have a friend or family. Such well-meaning partnerships often work for a single company, and can only give a quote from the one company for which they work. As in a previous time my worked well however, the days of buying insurance from your cousin Johnny or the spouse of your colleagues are long gone. You now have the ability to compare numerous offers side by side on the internet, and pick the life insurance policy that best suits your needs. Let’s face it, you’re going to own this program for a long time, you’re going to want to make sure you use your resources in the wisest ways.
Phase five. Understand the main variations in policy about term life insurance.
There are ARE variations beyond quality that should be weighed before making your purchasing decision, as commonplace as term life insurance policies. You will also find a policy with better benefits, more choices and/or from a company with a stronger financial profile by comparing various insurance policies.
Any insurance variations to consider are the length of the guarantee period, if the insurance is convertible into a permanent form of coverage such as a ‘whole life’ policy, are there ways to extend coverage for a child or partner, is there a waiver of the premium in case of disability or is there a rider that will refund the premium? To understand these differences it is necessary to choose the right life insurance policy for the right term.
We’ve all been affected by the recession and one crucial question to ask is, “Will your family be better off or worse off financially than they were two years ago if you were to die today?” Planning to take care of their future needs is more crucial now than ever. Proper use of term life insurance is one reliable way to put peace of mind back into the financial image of your family.