Tips For Find The Right Life Insurance Policy

By: Craig Thornburrow

Watch television for any amount of time and you will see a commercial for life insurance policies. Everyone thinks that having life insurance is a great idea but many times consumers don't know where to begin to even find the policy and then they feel like they probably can't afford the policy anyway. That is unfortunate because most policies are affordable and though it is one of those things in life that you hope you never need but should it become necessary you will be thankful that it was there.

Understanding a few basics about the type of policies that are available and how to figure out how much of a policy you may need are the most important parts of buying a life insurance policy. Here we will give you an overview of the two types of policies available, whole life and term life, and then give you some information on what to factor in when determining the amount for the policy.

What is Whole Life Insurance?

Quite simply put this is the type of policy that covers you from the day the policy is in effect until the last day of the insured's life.

This policy will never cancel now matter what age you are and will be payable even if you live to be 100 years old. You will determine the amount of the policy and that is what your beneficiaries will receive at the time of the insured's passing. These policies can be a little more expensive then a term life policy because with a whole life policy the company knows that eventually there is going to be a payout.

What is Term Life Insurance?

When you are buying a term life policy you are buying a policy for a specific amount of time. Most couples that have children purchase a policy that would help the survivor spouse raise the children and get them through college without needing to dip into retirement funds or taking out additional loans. These policies can be for as few as 5 years or for as many 30. Once you have reached the end of the policy term you will not receive any payout. These policies are usually cheaper than whole life policies because the insurance company is playing the odds that there is not going to be any payout on the policy.

Who Much Should Your Policy Cover?

When calculating how much your policy should cover here is a few things to keep in mind. If you or your spouse were to pass away what bills would the surviving spouse be left with that they could not manage alone? You should add those bills up plus any future bills that you are currently planning for such as college tuitions. To get the total for the policy most people add their mortgage amount, college tuitions, enough to cover any outstanding loans you may have and then add a few years of living expenses so the surviving spouse will not be pressured to work immediately afterwards. When you are figuring out your life insurance policy amounts talk with the insurance agent they will help you buy the correct amount of coverage.

Life Insurance
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