Most people don't inherently know how to shop for life insurance. If you have a lot of questions or are just generally confused by the whole idea of life insurance, you're not alone. This isn't at the top of most people's favorite talking points and it may be an intimidating topic for many others. Yet, the benefits of protection are plentiful, and it's important that you and your family have the right amount of life insurance. Here are five important life insurance questions to ask as you begin shopping for life insurance quotes.
How Much Insurance Do I Need?
This seems simple but this is a very important life insurance question that deserves real consideration when you first start looking for life insurance! As you begin to search for life insurance, you should think about your goals and why you are buying insurance in the first place. Are you looking to have money to pay for burial expenses and any unpaid debts when you are gone? What will be needed to provide for your loved ones financial security? Or is it more important to you that you leave behind an inheritance or even have funds available to you while you are still alive? The answers to these questions will help you determine both, what sort of policy to shop for and how much life insurance coverage you need. To get a thorough idea of the amount of insurance coverage you should purchase you can use our online calculator to work through possible expenses and future financial needs.
What Are the Different Types of Policies?
This is one of the most common life insurance policy questions that people have and it’s easy to understand why! Life insurance terminology can be confusing especially when it comes to the different types of policies. Understanding the basic differences between the types of policies can help you find the right plan. Policies come in several types. They may either be term life or universal life insurance and either group or individual policies.
- Term life insurance provides a guaranteed level premium for the term you buy them for, such as 20 or 30 years—this means that you’ll pay the same premium amount each month for the number of years you select for the guaranteed term.
- Whole life policies are permanent policies that don't expire, meaning that they last for life not just a fixed term, and these also usually have a savings or investment component to them. There are a few different types of whole life policies available that offer unique benefits, our life insurance agents will be able to recommend which whole life policy best fits your needs.
- A group policy generally comes from an employer as an employee benefit; you’ll need to enroll in these plans through your employee benefits program. Be aware the group policy coverage from your employer will normally not continue upon your termination of employment. Individual coverage plans are life insurance policies that are available to the general public; you’ll purchase these policies on your own.
Not all life insurance policies, agents, and companies are created equal.
Who Am I Buying From?
This is perhaps one of the most important life insurance questions to ask. Many agents and companies sell life insurance, but they are certainly not all the same. Determine how long the agent you are speaking with about life insurance quotes has been in business as well as the details on the particular insurance companies that they represent. Check the insurers ratings with companies like A.M. Best Co. and Standard and Poors. You should look for agents with many years of experience and life insurers with a strong financial history.
What If I Can't Pay My Premiums?
If you are purchasing term life insurance and stop paying your premiums, your policy is going to lapse and will no longer be valid. However, if you buy a permanent insurance policy and have some cash value built up in the savings part of the plan, there may be enough money to cover the payment of premiums from those reserves if you are unable to do so for a certain period of time.
Can the Policy Be Converted?
Term life insurance policies, the type that has a set period for the guaranteed level premium, are generally the most popular as they are the most affordable. Yet, when the term expires the purchaser is left without insurance coverage. Some term policies will allow you to convert the policy to a permanent one at a later date. This is an important life insurance question to ask upfront so that your options aren't limited years down the road.
Asking The Right Life Insurance Questions Is Key To Finding The Best Plan For Your Needs
You spend a lifetime working hard for your money and planning for an enjoyable retirement. Strategically preparing for your family's future entails more than just selecting the right investments along the way, and life insurance is an important part of a sound financial strategy. Buying life insurance is generally a bit more complicated than many assume, so it's important that you ask the right questions of experienced agents when you get life insurance quotes so that you end up with the right coverage to protect your family. IntelliQuote has over 20 years experience, answering any life insurance questions you may have. Contact us today and request a quote.