3 Types of Life Insurance and When You Might Need Them
Life insurance is one of the best investments that you could ever make for your loved ones. These policies are one of the only ways that you can ensure that your family has the money that they need, regardless of what happens to you.
Shopping for life insurance is not a fun task, but it’s not as hard as you may think. There are several different types of life insurance that you can choose from and thousands of different companies. Each of them is going to have different advantages and disadvantages that you should consider before you purchase a policy.
Each kind of life insurance plan works well for different people in a different stage of life. It’s vital that you get the perfect kind of life insurance policy to meet your needs.
Term Life Insurance
The most popular type of coverage is a term insurance policy. These plans are bought with a pre-determined expiration date attached to them, and once that date has passed, then you’ll no longer have insurance coverage. Because these plans are a temporary, they are going to be the most affordable insurance coverage that you can buy.
You can buy one of these plans to meet the needs of your family. They come in a variety of ranges, anywhere from 5 years to 30 years. The longer the term of the plan, the higher the premiums are going to be. If you’re looking to get the cheapest insurance coverage, then a term policy is going to be the best option for you.
Whole Life Insurance
Another attractive option for insurance coverage is a whole life insurance policy. Unlike a term insurance plan, whole life policies are a permanent form of coverage, which means that they are never going to expire. As long as you pay the rates for the plan, you’ll have insurance coverage.
These policies are a great option for anyone that doesn’t want to worry about losing insurance coverage in the future. While just about any age group can be accepted for one of these plans, they are going to be more beneficial to younger applicants that will hold the plan longer. A unique benefit of whole life plans is that they build cash value inside of the policy, and the longer that you pay the premiums, the more value that’s inside. You can use that value to pay the premiums or borrow money against if you need a loan in the future. You’ll get more benefits from a whole life policy if you start at a younger age.
No Exam Life Insurance
As you can probably guess from the name, no exam life insurance plans allow you to get insurance coverage without having to take the medical exam. The medical exam is the point of the application process where the insurance company gets a picture of your overall health to determine how much of a risk you are to accept for coverage. These plans are an excellent option for anyone that has a severe health condition. There are several advantages and disadvantages of no exam life insurance policies that you should be aware of when you’re shopping for insurance protection.
The most notable problem is that these no exam plans are going to be much more expensive than a traditional policy that requires a medical exam. The purpose of the exam is to give the insurance company an idea of your health and your risk for life insurance, without that exam, the insurance company is taking a much greater risk to accept you, and they are going to offset that risk by charging you higher insurance premiums.
Another pitfall of these plans is that you’ll be limited to how much protection that you can buy. Most insurance companies will only sell you around $250,000 worth of insurance. For most families, that isn’t going to be enough. Not having enough life insurance is one of the worst mistakes that you can make for your loved ones.
If you need life insurance fast or you’re afraid of needles, then a no exam policy could be right for you, but understand that the convenience is going to come with a price.
Why Life Insurance Matters
Life insurance is one of the best ways to secure the future finances of your family. If you were to pass away without life insurance coverage, your family would be responsible for a mountain of debt. Losing a family member is never easy, but being left with thousands and thousands of dollars of debt is going to make the whole situation worse. Don’t wait any longer to get the insurance coverage that your family deserves.
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