[The following is a guest post discussing things to look for when purchasing life insurance.]
If you have children or others who depend on your income for their survival, you should seriously consider a life insurance policy. This allows those close to you to have additional income in the case of your early death.
It is not only important to have a life insurance policy in place, but it is also necessary to have a sufficient amount of coverage. You should have enough insurance to cover at least five years of your current salary, if you are married. If you have children or many debts, you should have a large enough policy to provide up to ten years worth of your current salary.
When deciding what term to take for your insurance, take a look at what will need to be done with that money. For instance, if your children are newborns, a 25 year term policy will make sure that they are cared for if anything happens to you before they are able to financially take care of themselves.
If you’re married, you should purchase a policy that is two-in-one. This is a joint policy, versus two separate policies. The premium for a joint policy is often cheaper than the premium for two separate policies. You would not need to change anything about your coverage. You would still have the same benefits, but would be able to decrease the amount you pay.
Most life insurance policies are long term contracts. This means that once you sign the contract, you have a responsibility to make payments toward your policy. Therefore, when you are obtaining life insurance, make sure you have a firm understanding of your needs, what you are receiving and that you will be able to afford your payments. If there is anything you do not understand, do not contract yourself to the policy. Ask questions first.
Understand the types of life insurance available before making a decision on which to purchase. Most insurance policies focus on Term Life or Whole Life and knowing the difference is key. Bear in mind that with both of these types of policies, they can be tailored to your specific needs and situations. Be sure to conduct extensive research before making a decision.
When you are planning on purchasing a life insurance policy, select an independent broker. Independent brokers can generally offer more selection in terms of policy and cost than a broker who works exclusively for a specific insurance company. Company brokers are limited to the products their company sells, and may also be pushed by the company to recommend a particular product.
Insurance companies often have extra fees for customers who pay every month instead of just once a year. You may be able to save a significant amount of money on your life insurance by paying your premiums annually instead of monthly.
Prior to looking for life insurance on your own, check with your employer to see if there is available coverage through them. In many cases, employers can negotiate a rate for their employees and their family members. This can save you a lot of money and give you a great policy as well.
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