If anyone depends on you financially you need an appropriate whole life insurance plan, yet the unfortunate truth is that most people are under-insured with costly policies. With prices extraordinarily low and competitive, even if you have a good family policy for life insurance Lincoln NE agencies may be able to find a better deal.
In 1994, annual premiums for a $500,000 insurance policy for a healthy 40-year old man would have been approximately $900 to $1000 per year. Today, that same policy would cost about $400 per year. Even better, if you were previously denied coverage because of health-related issue you probably can find coverage today.
Choosing the Right Life Insurance Policy
There are two types of insurance: term and cash value. With term insurance, you only buy coverage for a certain time period, such as 10, 20, or 30 years. These policies are perfect for individuals only needing insurance until their kid’s complete college or until their mortgage is paid off.
Cash value policies generally cost a lot more than term life policies. Premiums are often 5 to 10 times higher, but these policies are more of an investment. Not only will the beneficiary receive the face value of the policy, but the cash value will accompany the settlement. Here are the top 3 strategies for buying a policy:
#1 Buy A Policy While You’re Young
If you buy a 30-year term policy when you’re 30 the price cannot rise after you purchase the policy. However, the rate for an insurance policy can rise for each year you wait. For example, if you’re 30 now you probably can get a great 30 year term life policy with annual premiums costing about $250, but if you wait until you reach the age of 35, that same policy will probably have premiums closer to $300.
#2 Evaluate the Amount of Insurance Needed
Most people are under-insured and need a boost in coverage. The number one question you should ask is how much financial support your family would need after you’re gone. For most people, this calculates to 8 times the amount of your income. If you’re the sole breadwinner with several dependents a large policy is ideal. If you only need to support a spouse who also works, then he or she will need less financial support.
#3 Opt for a Cash Value or Term-Life Policy?
Term-life policies only provides coverage for a certain period of time, but a cash value policy will continue for the rest of your life, no matter how long you live. Your typical term life policy covers you for 10, 20, or 30 years. These policies are perfect for people who only need insurance until their kids graduate from college or until they pay off a mortgage. Yet, there are other reasons people need a life-time insurance plan that covers dependents after death. If you need life insurance for dependents, a special needs child, a spouse with no pension benefits or coverage for several long-term bills or insurance for more than 30 years, it’s better to purchase a cash value policy.
Unlike many other types of insurance, the price for life insurance are much more competitive today. Just about everyone can cut premiums or lock in a low rate for a longer period of time just by shopping around.