Having a life insurance policy is great peace of mind for most people, as it assures them that their dependents will be assisted if the worst should happen. Unfortunately, most people pay too much for their monthly life insurance premium. This article will advise you on life insurance and give you a trick to lock in a fantastic rate.
What Is Life Insurance?
Life insurance is a financial product, with policies available in a range of different sizes and options. It is important to be aware of the differences so that you choose the policy that provides the best coverage for you. Once you choose the right policy, you pay monthly instalments for a set time. These instalments fund a lump sum that, in the unfortunate event of your death, goes to your dependents.
There are 2 Main Policies Available
While there are many types available, life insurance policies can be classified as either term insurance or whole of life insurance.
1.Term Life Insurance
This covers you for a set period, typically between 10 and 25 years. The payout will be made only if you die during the term set in the policy, which is typically up to you to decide. Under the term life insurance umbrella, there are three main types.
Level Term Life Insurance – This policy pays your designated beneficiaries a fixed lump sum, should you die within the term of the policy, which does not change in amount no matter when you die during the policy term.
Decreasing term life insurance – This pays out a smaller amount the further along your death occurs during the term of the policy. People who choose this policy are typically ensuring debt repayment.
Increasing term life insurance policies – This pays a higher amount the further along your death occurs during the term of the policy. These policies are useful to protect your beneficiaries from inflation rates.
2. Whole of life insurance
These policies run for the rest of your life, however long that may be. These policies are sometimes called ‘life assurance’, as the payout is guaranteed no matter when your death occurs.
Whole of life insurance policies are more expensive than term life insurance policies of any type, so you should carefully weigh the benefits of having this type of policy and the expense it entails with the benefits. When in doubt, compare the costs and benefits of both whole of life and term life policies to determine which suits your needs and budget.
How Much Can I Expect To Pay For Life Insurance?
Policy prices vary greatly depending on the type of policy, the duration of the coverage, and the terms. Many important factors can come into play when getting a quote for life insurance, Moneyexpert.com have a simple, easy to use tool on their website that will take the mystery out of life insurance. By providing the answer to a few simple questions, you will be able to clearly see your options on life insurance policies and lock in a great rate.
Don’t take months considering your options; use this simple trick to lock in underpriced rates for the perfect life insurance policy for you, without the worry that you will pay too much.