Acquiring cheap and affordable life insurance is not as difficult as you might think, and it may be one of the most important life decisions that you can make to ensure your family’s peace of mind. Big and small companies alike offer inexpensive coverage in this market, but there is also a lot of marketing hype that disguises more expensive alternatives. Be sure to comparison shop, and, after getting the cheapest life insurance quotes available, you can make a decision that suits your household budget. Afterwards, you and your family can rest easy knowing that their future is assured, despite whatever unplanned tragedy may occur to disrupt their lives.
When Is The Right Time To Buy Life Insurance?
The general rule of thumb when buying any insurance is to get coverage when your need is apparent. We often are forced to buy insurance to cover our property risks by states and lenders, but we just as often put off getting life insurance to cover our most precious asset, the future of our family. Do you want to leave your spouse, children, or other loved ones saddled with debts, loss of income, and uncertainty after your untimely passing? Many employers provide a level of coverage in their benefit packages, but these amounts are usually found to be insufficient. Acquiring the prudent level of insurance coverage should be an ongoing effort on your part, including an assessment of your needs, a review of your current circumstances, and support from professionals.
The “ABC’s” of Life Insurance
Insurance companies can offer cheap life insurance due to many savings gained through technology and the fact that we are healthier and living longer than ever before. The policy is an agreement between a client and the insurer where the insurer pays a contracted amount in the event of death from an accident, illness, or other insured event. The insured is required to pay a fee known as a premium that is paid on an agreed upon basis. In the United States, a lump sum is paid to the beneficiary(s) upon the insured’s death. Life insurance can be used to pay funeral expenses, estate tax liabilities, estate administration costs, medical expenses, outstanding debts, as well as provide for a steady income to cover ordinary living expenses or a child’s education.
Types of Life Insurance – Term And Permanent
There are a number of types of available cheap life insurance in the market today. The two primary forms of life insurance are known as term insurance and permanent life insurance. Within each type of insurance plan, there may also be additional benefit coverage options available. For example, a disability rider may provide an income stream if you could not work as the result of an accident or illness. Critical Illness Insurance, Dismemberment Coverage, and Disability Income Insurance are three examples that will provide assistance while you are still living.
Term Life Insurance
Term Insurance is limited to the number of years stipulated in the policy or for as long as you maintain making your scheduled premium payments. This type of life insurance is the easiest to understand and straightforward in how it operates. Simply put, this policy only pays if death occurs within the term of the policy. There are several types of term policies that include:
- Yearly Renewable Term Life Insurance: A one year term policy with an option to renew each year;
- Decreasing Term Life Insurance: Designed to pay off a mortgage upon the death of a homeowner;
- Level Term Life Insurance: The insured chooses the period to keep the policy.
Permanent Life Insurance
The second type of life insurance policy is known as Permanent Life Insurance. This type of insurance allows the insured to keep it for life. Permanent Life Insurance, commonly referred to as “Whole Life”, pays a benefit at the time of death, but also includes an investment feature that may appeal to some consumers. Premiums are guaranteed to remain at a fixed rate, and a portion of these payments is invested based on the elections made by the insured. The three major types of permanent life insurance include:
- Traditional Whole Life: This policy includes a guaranteed sum that will be returned if you choose to end your policy in the future, as detailed in a table of “cash values” contained within the policy documentation. These “cash values” increase over time through scheduled dividend payments.
- Universal Life: This policy operates like a savings plan with monthly interest credits and premium cash values, reduced by fees and costs for term insurance.
- Variable Universal Life: In this case, cash values are also combined with life insurance, but the insured has more flexibility in selecting where his monies are invested from a variety of separate accounts offered by the insurance company.
We cannot predict the future and whatever tragedy it might bring, but we can assess our financial circumstances and purchase cheap life insurance to meet our needs. The process begins with education and preparation, and then moves to selecting from a group of cheap life insurance quotes. Buying life insurance is one of the best investments that you could ever make, whether you want security from becoming seriously ill, or protection for your loved ones. Act now to ensure your family’s and your immediate comfort and peace of mind.
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