If you’ve been wondering what you need to know before buying life insurance, having a simple guide at your disposal could help make the shopping process easier. Whether you have a pressing desire to purchase an extensive Life Insurance policy or whether you’re simply putting the idea on the table for the first time, it’s crucial that you understand the purpose of this insurance, the typical policy structure you may come across, the factors that could play into your final premium price, and the sort of coverage you and your family may want or need. Here are some tips for buying life insurance.
Understand the Structure of a Typical Life Insurance Policy
Having a general overview of the structure and goals of the average life insurance policy can help you establish a good basis for comparison when examining your choices. For most life insurance policies, the specifics depend on your personal needs. However, the purchasing process is likely to look similar no matter what type of policy you end up selecting. In general, most policies will allow you to:
- Purchase protection for a certain term, generally either whole-life or a set term
- Have a certain sum of money paid out to your beneficiaries upon your death
- Have your monthly premiums adjusted based on lifestyle factors and any pre-existing health conditions
Research the Different Factors That Could Impact Your Policy’s Overall Cost
What you ultimately end up paying per month in premiums for your life insurance policy may depend heavily on various pre-existing factors. For instance, someone in the later stages of life and in poor health may end up paying significantly more for supplemental life insurance than a younger or healthier individual might. One trick that could help you get your cost estimates down is to improve your lifestyle and try to adopt healthier habits before applying for an insurance policy. Some of the most common factors that play into determining a life insurance premium cost include:
- Your driving history
- Your health habits and lifestyle
- Your current health and any diagnosed conditions
- Your gender and age
- Your history of smoking
- Your family’s medical history
Choose Coverage That Offers the Amount Your Family Would Need To Get By
Lastly, you should choose a policy that provides the estimated coverage your family or other beneficiaries would need to get by in case of your passing. Many policyholders opt for coverage that could pay for:
- Educational expenses and college tuition
- A home mortgage or rent costs
- Regular retirement expenses
- Other types of insurance, such as car insurance
- Car loans and consumer debt
- Everyday bills, including grocery bills
For anyone considering the purchase of a Life Insurance policy for the first time, learning about the purpose, structure, cost, and coverage of such a policy can be a helpful first step. If you’re currently in the market for your own life insurance policy, make sure you bring this guide along as you make your decision.
About Brooks, Todd & McNeil
Since 1839, the independent agents at Brooks, Todd & McNeil have been pleased to offer our community the best and most affordable policies from a variety of providers. Our dedicated facilitators are ready to put their 75 years of combined experience to work on your claims. To learn more about our products and services, contact us today at (800) 448-4567.