Do I need Term of Permanent Life Insurance? What is the difference, anyway?
Term life insurance policies are less expensive than whole life and designed to provide you with coverage while your dependents are the most vulnerable. Most people opt for a term policy, for this reason- mainly the affordability. When your dependents are grown up and on their own, they won’t need as big of a safety net as they do when they’re young. You can sit with your life insurance agent to discuss the different categories and types of financial responsibilities you want our insurance policy to cover, such as your funeral costs, your dependents’ educational costs, day-to-day living expenses, etc. Policy coverage amounts are easy to adjust according to your needs and circumstances, and what you can afford to pay each month. Your agent can also help you steer you in the right direction if you need lifelong coverage through a permanent, whole life insurance. Though more costly, this type of policy has its advantages, but you should not purchase one if the benefits don’t work for you. This type of policy can also be given as a gift! Talk to a trusted agent for advice on which direction to take.
Are There Policy Exclusions I Should Know About?
Insurance companies can definitely exclude certain hobbies and activities from policies, and often do! They’re willing to insure your life, but they won’t take a gamble on you not being killed doing something obviously life threatening. However, that doesn’t mean if you’re an avid base jumper, sky diver, or stunt person, it’s impossible for you to purchase life insurance policy. Ask your agent to look into policies that cover you while you’re living life on the wild side… keep in mind, you may have to pay higher premiums in order to be covered. Not all exclusions are as “out there” as the examples we’ve given. Each policy is different, so make sure you do your research and know the stipulations before you buy.
What are “riders” and do I need them?
Simply put, a rider is an add-on, like an upgrade. A good example is this: maybe you want the option of having your policy pay off, should you incur a permanent disability, as well as death. A rider could raise your costs, but it’s the same concept with any insurance policy. It costs money you don’t want to spend, and you wish you never had to use the policy in the first place, but having it may be to your benefit in the long run.
All of the questions in this blog as well as part one (If you missed it, go back and read!) are just a few of the many things you should think about and discuss with your agent while shopping for a life insurance policy that best fits your and your beneficiaries’ needs. Keep doing research, talk to people you know, and ask as many questions as you need to ask, in order to fully understand what you’re getting into and what kind of benefits it will provide, before making a decision to purchase. Talk to someone in our office if you need help! We’re more than happy to answer any of your questions and lead you in the right direction!