How Long Do You Need Cover For?
You may not think about it but,
The first thing you’ll need to do is figure out how long you want your life insurance policy to last. Do you want it for a few years? Or would you prefer an indefinite period?
Coverage Until You Die
The first thing to consider when choosing a life insurance policy1 is whether or not you want it until the day that you die. Whole life insurance may work best for you.
What does this mean for you?
This means that if your death is uncertain and could happen at any time in the future, this policy term ensures that your beneficiaries will always have the life insurance payout they need.
However, if you want to make sure your family is set for a few years or so but don’t think about it too much after that, term life may be best for you!
Coverage While You Have a Mortgage
Do you have a mortgage? If so, this will affect the type of life insurance policy that may work best for you.
People who borrow money from their homes to pay off other debts and expenses need to make sure they’ll be able to afford their monthly payments if something happens. So how does a life insurance policy factor into all of this?
If you want coverage while you’re still paying off your house, then the term or whole life might not be right for you! Instead, look at universal policies like Universal Life Insurance which allow people with mortgages some flexibility when making premium payments.
You should also look at buying affordable but quality coverage if possible- because kids grow up fast (and college tuition is expensive!)
Figuring out which life insurance policy is right for you can be a difficult process. But by looking at your needs and financial situation, it should be easier to find the perfect one!
Coverage When You Are Older
Life insurance is usually purchased when you’re younger so that it’s not as expensive. But the older you get, the more your premiums will increase!
This means life insurance companies may charge a higher premium for someone over 60 than they would for someone under 35- and this can make finding affordable coverage difficult later on in life.
Let me show you,
- If you are over 50 and healthy, you can get a good coverage deal by purchasing term life insurance. But if you’re over 65, the best option for you is probably your whole life- it’s usually more affordable. It will cover certain health conditions at any age!
- Suppose you are over 50 and have a pre-existing condition2 (high blood pressure or diabetes). In that case, this might affect your ability to get cheaper life insurance later on as well. Your premiums may be higher depending on what kinds of diseases are currently affecting your body.
- You can also apply for an over 50s life insurance policy, which can be a good option for people who don’t think they’ll need life insurance after age 65.
What Kind of Payout Do Do You Want?
There are two types of insurance payouts- a lump sum or annuity. A whole life policy pays out in one lump sum while terming policies payout over time, usually until the death of the person who purchased it (or sometimes for just 20 years).
Some people don’t want to invest their money, so they may like an annuity paid out as regular monthly income. This might be useful if you know that your beneficiaries will need some regular cash flow coming in after you die. For example, child support payments!
Whichever option sounds best to you and meets all your needs should work well enough- but make sure you have something planned for when anything happens to happen!
Which Payout Is Best?
There are many factors to consider when choosing the best life insurance policy for your needs. We’ve gone over what they all mean and how it affects which payouts might be right for you- but ultimately, this is going to depend on your situation!
Sometimes people want just enough coverage that their family will be set in case anything happens so that term life would work well. But other times, people have big retirement goals and don’t want to take any risks with their cash at risk- universal may provide good protection while still having some flexibility built in!
The only way to know for sure is by talking with an agent specializing in life insurance policies like Whole Life Insurance or Term Life Insurance. They’ll be able to help you weigh your options and choose the best life insurance policy for you!
Policy Pros and Cons
Here are some of the pros and cons for each type of life insurance policy:
Whole Life Insurance
Whole life insurance is generally more affordable and easier to understand. It will cover you at any age!
With a whole life policy, the money that goes in each month cannot be taken out, so if you need emergency funds, it’s hard to use them for anything else unless you buy an endowment or annuity rider, which offers some flexibility with your premiums.
Some people also think there are too many restrictions on how much comes out over time (even though they don’t have access) compared to term policies.
Term Life Insurance
Term life insurance provides cheaper coverage than other policies because usually, only one life insurance premium needs to be paid upfront before protection kicks in! This means someone who wants less coverage can still get it without the need for a hefty cash lump sum payment.
Term life is not as customizable when compared to other policies. Some people don’t like how their rates could be higher depending on what they have going on in their lives (for example, if someone has diabetes).
Over 50s Life Insurance Policy
These are often more affordable than standard policies because you usually only pay one premium upfront, with the plan lasting until age 65. At this point, there’s no penalty for stopping regular payment!
There are also often discounts available such as those offered by AARP or your employer. You’ll want to make sure that this type of policy fits all your needs- since it won’t cover anything past 65 years old!
Some people think that this is not a good option for anyone but those close to retirement age because it doesn’t offer the same level of protection as other policies- and you’ll have to pay one premium upfront!
It also won’t cover anything past 65 years old. You could always invest your money into something like an annuity or IRA if you want more flexibility with how much coverage you need.
How Do I Choose the Best Life Insurance?
The best life insurance policy for you will depend on a lot of things- so it’s important to get an idea about your needs and goals before choosing which type would be the right fit.
How Do I Make Sure I Get The Best Deal?
One of the best things you can do is to shop around and compare quotes from different agencies. You’ll want to make sure that your needs are being met, but also keep in mind what type of policies will be most affordable for you!
Can I Have 2 Life Insurance Policies?
Yes- but it’s important to make sure that you aren’t overpaying for coverage. You might also want to discuss with an agent if having two policies is a good idea in the first place!
What Happens If My Coverage Expires?
Suppose a person has life insurance coverage through their employer. In that case, they may have an option to extend it if there’s no lapse between when it expires and covers them again.
This usually only applies if the insurance company offers this service, however, so you should still talk with an agent who specializes in life insurance policies before making any decisions about whether or not something like this would work well for your situation at all!
The best life insurance policy for you will depend on what your needs are and how much coverage you want. One of the biggest things that will help determine which type is right for you is talking to a specialist who can help you weigh the different pros and cons of each type of policy.