8 Useful Tips for Buying Life Insurance

March 10, 2022

You can get a life insurance policy at any age, but usually, the younger you start, the better position you’ll be in to get better coverage at more affordable rates.

Keeping this in mind, here are eight helpful tips for buying life insurance.

  1. Know your needs

    Although most people can benefit from life insurance, high net worth individuals have a wider menu of funding options. Essentially, people who have enough money in the bank to pay estate taxes after their deaths don’t need life insurance.

  2. Calculate your coverage requirement

    The easiest way to calculate how much life insurance you need is to divide your resources into these three categories:

    • Social Security/retirement benefits
    • Group life insurance
    • Other assets

    Then estimate your end-of-life expenses, including final expenses, debts, and living expenses for survivors.

  3. Consider your goals

    Life insurance plans aren’t just about the policyholder’s death and assets. Some policies might have unique, attractive features such as rare discounts.

  4. Determine the type of life insurance you need

    The three main types of life insurance are whole life, term life, and hybrid policies. Whole life policies cost more but deliver the most, including a growing investment account for the policyholder’s lifetime. Term life is the least expensive but only lasts for a stated term, say 20 years, and offers limited benefits.

  5. Check if you need any ‘riders’

    Life insurance policies, like other types of insurance, start out with basic coverage. From there, you can add as many riders as you want. Riders extend your coverage, allowing you to customize plans based on your specific needs. Two important riders are waiver of premium and guaranteed insurability.

  6. Shop around

    Get a series of quotes from different life insurance agencies and make your own comparison. Usually, an individual can arrive at an appropriate policy selection after weighing the pros and cons of several different options. The days of people being forced to accept one-size-fits-all insurance policies are long gone. Life insurance seekers now have much more options, so they don’t have to settle for policies that don’t completely work for them.

  7. Decide on premiums

    As you narrow down your choices for life insurance, think about whether you want to pay your premiums once every year or as monthly installments. Usually, you end up paying more with monthly payments that include additional hidden charges. You’re more likely to save money by making larger annual payments.

  8. Inform your beneficiaries

    Once you’ve finally decided on a life insurance plan, educate your beneficiaries about the details. It’s better not to keep it a secret or surprise since there’s a chance that your beneficiaries won’t find out about your policy on their own. If you want to ensure your beneficiaries get benefits, including income, you should notify them once they are listed in the plan. Make sure your documents are stored in a place where they can easily find them.

When you enroll in life insurance, you’re investing in your loved one’s future. It shows you care about their safety and survival, plus your estate becomes a generous gift to those special people in your life. Contact us here at Gant Insurance Agency to learn more about the best life insurance coverage options for your situation.