Life insurance protects your family and provides you with peace of mind, but choosing the best policy can be confusing. The policy you need will depend on your specific lifestyle, financial situation, and more. Keep reading to learn more about your life insurance options.
How much life insurance do you need?
Ask yourself the following questions when deciding how much life insurance to get:
- What are your current expenses?
- How would your family pay for everyday expenses without your income?
- How much can you realistically afford to spend on insurance premiums?
- What obligations (debts, funeral expenses, etc.) would your family be left with in the event of your death?
- How long would your dependents need support?
- What opportunities do you want to provide for your family? (For example, do you want to be able to leave your grandchildren an inheritance or pay for your children’s college education?)
When should you reevaluate your current policy?
Because life is constantly changing, you’ll need to periodically reevaluate your current life insurance policy. You should take another look at your policy if:
- You’ve recently been married or divorced
- You have a new child or grandchild
- You’ve started a new business
- You’ve purchased a new home
- You or a member of your family have been diagnosed with a new health condition
- You’ve recently received an inheritance
Insurance company representatives can help you evaluate your new situation and choose a policy that meets your current needs.
What are your options?
There are two main options when choosing life insurance: term life insurance and whole life insurance.
Term Life Insurance
Term life insurance is in place for a fixed time period. If you choose a 15-year policy, your coverage will end when those 15 years are up. Term life policies have lower premiums than whole life policies because term policies are designed to protect younger people with low incomes. Someone with young children, a mortgage, and few assets may be best served by term life insurance.
Whole Life Insurance
Whole life insurance policies never expire. The coverage lasts until your death—no matter when it occurs. The premiums for whole life insurance policies are higher because it is guaranteed that the insurance company will have to pay out. Whole life insurance policies also have added benefits such as cash accumulation that makes money available before your death through loans or withdrawals. Someone with substantial savings, few financial obligations, and independent children may be best off with a whole life insurance policy.
Make sure your family is protected. An insurance agent can help you find a policy that suits your lifestyle and needs. For a free quote, contact Best Insurance today.