Life insurance may not be on your list of most fun things to think about, especially considering that it forces you to consider your own mortality, but it’s worth taking care of sooner rather than later. A life insurance policy is the best way to ensure your dependents are taken care of in case the worst should happen. Any policy will guarantee a death benefit to your beneficiaries, usually payable in a single lump sum. There are policies that provide additional benefits as well, such as savings and investment components, so you may want to look into that as well.
It’s easy to assume that you won’t need to worry about dealing with life insurance companies until you’ve started your own family, but this isn’t necessarily true. The unexpected can happen at any age, and rather than leave your family saddled with final expenses, you can purchase burial insurance for cheaper than other policies and still protect your family’s finances. It’s also generally easier to get larger coverage amounts for lower prices when you’re still relatively young and in good health. While no medical exam policies do exist, you’ll also have an easier time passing a medical exam when you’re younger. How can you know what type of life insurance is right for you? Here are some common policies and ways you can find quotes online.
Term Life Insurance
This is likely the simplest form of life insurance that simply provides a death benefit and nothing more. The advantage of a term life insurance policy is that these policies tend to have the lowest premiums around, making them great starter policies for younger people without much financial security. They’re also great for families who just need coverage while they’re working toward a specific goal, like covering college tuition costs for the kids.
As the name suggest, a term life policy only provides a death benefit for an agreed upon length of time. The term length is usually set in increments of 10 years, but you may be able to find a policy that lets you renew on an annual basis in exchange for a higher premium. Term life insurance can also be upgraded to a permanent policy if you prefer.
Whole Life Insurance
This is one of the most popular forms of permanent life insurance that provides a savings component in addition to the death benefit. You can accrue cash value with this type of policy, and you can speed the rate by paying your monthly premiums ahead of time. You can use the cash value as it’s needed by borrowing against it or making withdrawals from it. Just remember that withdrawing too much can eat into your death benefit, and any amount borrowed will need to be paid back with interest.
This isn’t the only insurance policy to provide additional benefits. With a variable universal life insurance policy, for example, you’ll have an investment component that accrues cash value in subaccounts that act like mutual funds. You can build cash value quickly this way, but these policies are vulnerable to market volatility, making them riskier than other options.
Finding an Accurate Quote
Once you’ve found the type of policy that makes sense for your unique situation, you can start exploring life insurance quotes online. Fortunately, there are quote aggregates online that can help you get accurate quotes from the most trusted insurance companies. Your premium payments will depend on a variety of factors, such as if you have lifestyle habits that make you a greater insurance risk (like if you’re a tobacco user), your age and overall health at the time, the length of your policy, and how much coverage you need. Providing as much accurate information as possible before the underwriting process will help you get the most accurate quotes.