From The California Business Journal Newswire.
Life insurance is an important part of taking care of your financial future. In the event of your passing, it is critical that you leave benefits behind for your loved ones. They can use the money from your life insurance to pay for funeral expenses or to supplement a lost income. While it can seem confusing to try to shop for the best policy, it’s actually a lot easier than you might think. The key here is to compare different companies and rates to find the best one for you.
There are dozens of different types of life insurance policies. It’s important to understand the basics of each so that you can be sure you’ve chosen one that offers the coverage that your family will need. Term policies are typically only good for two or three decades. After this time, the policy is deemed expired and can no longer be drawn on. Universal or whole life insurance allows you to have coverage permanently. These policies hold cash value that you can eventually draw on in the event that you need money. Other types of policies include guaranteed life and variable coverage.
Generally speaking, life insurance is similar to any other type of policy that you have. You open an account, receive a premium amount and then make payments monthly in order to keep your coverage active. If you fail to pay the premium, you’ll eventually lose your coverage and can no longer receive those monetary benefits. Depending on the type of policy that you take out, you may need to go for a medical exam. This allows the company to see how healthy you are before they approve you for coverage. Basically, if you have health problems and are not in good shape, you’re viewed as a liability and the company may deny you coverage. Some companies don’t require that you go for an exam, rather they’ll ask a few health questions when you’re making out the application. It is important to be truthful when you are making out this application.
Depending on the type of policy that you’ve opened, it may be holding cash value. This means that you can draw on the account prematurely if you happen to need the money. Oftentimes, this is known as a viatical settlement, which basically means that you’ll sell off your policy to a third party in exchange for a lump sum of cash. It’s easy for you to get an estimate on the value of your policy online. As far as payouts, your loved ones will receive the death benefits from the policy in the event of your passing. Some minor paperwork may be needed on their end, but proceedings are relatively quick and straightforward.
If you’re on a budget, you need a policy that isn’t going to cost you an arm and a leg. There are a few ways for you to find a good company to go with when taking out life insurance. You should consider comparing rates online prior to opening an account. Many companies will allow people to get a quote for coverage before actually signing onto anything. Once you’ve created a new account, it is important that you pay so that the coverage stays active. You can either have the money deducted automatically from your account each month or you can pay your bills manually.