Life Insurance 101
Life insurance can be confusing. With so many options and variations, it can be difficult to decide which policy is best for you and your budget. Below you’ll find tips that will help you get started in determining the right timing and type of policy for you.
1. Buy life insurance when you’re healthy.
As you age and you experience health issues, you’ll pay
much higher rates for life insurance. Buy a policy as young as you possibly can,
but don’t wait until you become a parent. As you age, the cost of coverage will
2. Many factors should be considered.
Think about who will suffer if your income is gone. If you decide on a term policy, the policy
should last as long as it takes for your dependents to move on and move out or
for when your retirement income starts to kick in. It’s a good idea to sit down
and consider the following factors when thinking about life insurance:
- Medical expenses, burial costs and estate taxes
- Support for family members
- Reoccurring monthly expenses including day-care costs,
tuition, retirement and all other bills
3. Know your options and the differences in policies.
Life insurance comes in two main forms, with many
variations. The simplest (and often times the most affordable) policy is a term life insurance policy. With a term policy you pay
premiums for a set number of years. The underwriter will pay a death benefit to
your beneficiary if you pass away during the term set at the outset.
Another option is a permanent life insurance policy. The advantage to
this type of policy is that it stays in force and pays off when you pass away.
Whole or universal permanent policies can work as savings plan because over
time, they build up cash value that you can tap into or it can be used to
reduce your premium. If you’re unsure
whether you want to purchase permanent coverage, you can always go with a term
policy that can be converted into a permanent policy based on your health at
the time the original policy was issued. For more information about types of policies, click here.
4. How often should I be talking with my life insurance agent to review my policies?
As you experience major life and financial events, you should review your policies with your agent. Examples of these events include income changes, marriage, divorce,
retirement, the birth of a child, adoption or a large purchase such as a home or business. or purchase of a major
item such as a house or business.
Our experienced life insurance associates at McKinney Insurance can help you
choose a policy that fits your needs and budget. Call us today at (828)
684-5020 for a personal evaluation and to learn what kinds of policies will provide
what your family needs in case the unexpected were to happen.
Nationwide Insurance has more than 80 years of experience and has been rated “A” or higher as a life insurer for more than 75 years. (Source: A.M. Best Co. Data)