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How to Get Life Insurance: A Beginner’s Guide
Even if you aren’t married or have kids, it’s still important to get life insurance, which will help your loved ones financially in the event of your untimely death.
But, with so many different types of insurance out there and so many details to consider when you buy, it can be hard to know where to start.
This guide on how to get life insurance will walk you through the process step by step, explaining the difference between term and permanent life insurance and what questions you should ask yourself before buying either policy type.
#1. Research available policies
Start by shopping around. One of your first steps should be getting in touch with several different insurance companies and seeing what types of policies they offer. Many life insurance companies have online quote generators that you can use at no cost; make sure you take advantage of them.
They’re an easy way to compare policies from multiple insurers, get a ballpark estimate for how much coverage would cost and see what other coverage options might be available (for example, a policy with optional disability insurance or critical illness coverage). You may also want a personal agent; ask friends and family if they know one.
An experienced agent will help you find coverages that fit your needs—and he or she may even negotiate for lower rates or get you extra perks, like free accidentalntal death benefits.death accident coverage would cost and see what other coverage death benefits.
#2. Check your eligibility
Though it may seem like a lot of work, life insurance isn’t only for those at risk of dying soon.
It’s worth getting a quote if you are in your 40s or 50s and have children, because they will be dependent on you while they are growing up. If you don’t have kids, think about people who rely on your income and would suffer if something happened to you. You can even get coverage in case you develop a terminal illness later in life that limits.
your ability to work—life insurance is helpful when there is risk involved with taking out loans or investment opportunities since loan officers and investors won’t want to take risks with someone who could die anytime soon. The bottom line? Check your eligibility so you know what kind of policy fits your needs.
#3. Learn about plan options
The first thing you need to understand about life insurance is that it comes in several forms and offers different benefits.
The simplest, least expensive option is term life insurance, which pays a set sum of money (the face value) if you die during what’s called your term or coverage period.
Term policies are usually for a specific amount of time—10, 20 or 30 years, for example—and they’re good options if you want basic protection against losing your income should you die during that period. A whole-life policy will remain in effect for as long as you live; it also builds cash value over time and pays dividends. You can borrow against those dividends, but most people use them to pay premiums when they get older.
You’ll have to decide whether you prefer whole life or a combination of term and permanent policies. And then there’s universal life insurance, which combines all three types into one plan with flexible premiums and benefits that can be changed at any time.
Finally, there are hybrid plans such as variable universal life insurance and indexed universal life insurance that combine aspects of traditional plans with some of those mentioned above. They have more flexibility than traditional plans but less than other hybrids do.
It all depends on how much risk you’re willing to take on yourself when it comes to choosing your plan type. Before deciding on one type over another, ask yourself these questions: What am I trying to accomplish?
#4. Apply for coverage
As soon as you decide to apply for life insurance, find a reputable agency that can help you through the application process.
The last thing you want is an agent who is more interested in getting you through an application than he or she is in actually helping you find coverage. Look for agents and agencies with positive reviews from customers on sites like Yelp and Angie’s List.
While insurance applications can be time-consuming and complicated, these platforms will help streamline your search for someone you trust who can guide you through it all. Your search should lead you to multiple quotes from various companies so that you can pick and choose what’s best for your situation.
If any of them are unclear about coverage details, walk away—there are plenty of other options out there. #5. Finalize your policy: Once you’ve found an agent or agency that feels right, don’t rush into signing anything without reading over every word carefully.
You’ll have to agree to certain terms and conditions before you’re covered by a policy, so make sure everything is clearly laid out in black and white before signing off on anything. Most importantly, make sure that every question has been answered fully before moving forward with anything else!
#5. Protect your policy
In order for life insurance coverage to be approved, you will need a physical exam. This is why you must protect your policy by having a physical every year. By doing so, your policy will remain active and continue to protect your loved ones.
Also, if it has been more than five years since you got a new policy or had an exam, now would be a good time to get checked out again. If anything looks off, you can use that as an opportunity for preventative care before it becomes something bigger.
Protecting your policy doesn’t just mean getting exams. It also means paying your premiums on time and not missing any payments (if you do miss payments, make sure to let them know).
Don’t wait until you’re sick or injured either! It’s best to stay healthy because health problems can impact your ability to keep up with premiums later on down the road.
Just think of all of those medical bills piling up… Not fun! So please remember these tips when protecting your policy.