Life insurance is a complicated purchase if you’ve never done it before. There are lots of words and phrases you’ve probably never heard before, and, let’s be honest, never will again. But in order to ensure you’re as up-to-date on your purchase as possible, we’ve outlined the most popular frequently asked questions about life insurance we get on a day-to-day basis.
Life Insurance FAQ’s
What is the Average Cost of Life Insurance?
In most cases, life insurance is much more affordable than applicants think.
Because there are so many different factors that go into calculating monthly premiums, it’s difficult to say what the “average cost” is, because it varies greatly based on age and health. For example, a non-smoking 25-year-old will pay $27 a month, but a 40-year-old smoker will pay $98. If you want to look at a general idea for your age range, you can view our table here.
How Much Life Insurance do I need?
It’s important that you get enough insurance protection for your family. There are several different factors that you have to calculate to determine your life insurance needs. You’ll need to look at your debt, income, and dependents. We go into more depth of your insurance needs here.
How do I Choose a Life Insurance Beneficiary?
Naming a beneficiary for your life insurance policy is vital. This is the person that is going to receive the payout from your plan if anything were to happen to you. There are several different types of beneficiary that you can choose from. Because it’s vital to have a beneficiary from the plan, we detail picking a beneficiary to help you here.
What is the Purpose of Life Insurance?
Life insurance is one of the most important purchases that you’ll make for your family.
It gives them the resources they need if you pass away. The payout from the plan can help them pay off debt, pay for funeral expenses, pay for basic expenses, and much more.
What are Life Insurance Dividends?
Life insurance dividends are an interesting incentive for anyone looking for a whole life insurance policy.
These dividends are cash paid out to policyholders when the insurance company has additional profits. Each company is different in how they handle their life insurance dividends. Because it can be a nice advantage for your life insurance policy, we detailed more here.
None of my family members have life insurance, why do I need it?
Sadly, there are millions and millions of people that don’t have life insurance. The vast majority of people see themselves as invincible or think nothing is going to happen to them.
That’s one of the worst mistakes you can make. You could leave your family with a mountain of debt.
What are the taxes associated with life insurance?
The taxes associated with life insurance can be one of the most confusing aspects of the process. There are several different taxes that policyholders should be aware of when dealing with premiums and payouts. You can get more details about the taxes with life insurance here.
How do I know if I need life insurance?
More than likely, you need life insurance, but there are some circumstances that you may not need a policy. There are several questions that you can ask yourself to help you know if you need life insurance.
I’ve heard life insurance is expensive, are there cheap options?
The fact that life insurance is too expensive is one of the biggest myths surrounding the policies. In most cases, life insurance is much more affordable than you might think. If you’re looking for the cheapest insurance possible, term insurance is the best option.
What are the different options for life insurance coverage?
There are several different types of life insurance options that you’ll have to choose form. You’ll have to weigh the advantages and disadvantages of each type and see which ones fit your needs the best. It’s not always easy to compare life insurance as it isn’t truly apples-to-apples, but a little research can reveal what it is, and what it isn’t.
What’s the best way to get quotes from insurance companies?
The days of calling agents to get quotes are long gone. With the Internet, you can quickly receive quotes from insurance companies online. This is an excellent way to compare dozens of companies quickly.
Am I too old to get an affordable life insurance policy?
Age is one of the biggest factors that is going to be used to calculate your premiums. The older that you are, the more expensive your premiums are going to be, but that doesn’t mean age should stop you from getting a policy. You can see a rough estimate of what your premiums will be for your hate here.
What is the medical exam I have to take for an insurance policy?
A lot of applicants are scared of the medical exam, but it’s probably not as bad as you imagine. The insurance company only wants to know a few simple things like your weight, blood pressure, heart rate, and your family history. They will take a blood sample and urine sample. The whole process won’t take long, but you can learn more about it here.
What are life insurance riders?
You may have heard of additional insurance riders, which are supplemental coverage that you can add to your policy. Each rider will cover additional things are circumstances that you arise in the future. You can learn more about the common types of riders here.
What is an accelerated death benefit rider?
Life insurance is a wonderful tool in case you or a loved one were to pass away unexpectedly, but what if you have a terminal illness and need long-term care. This is where an accelerated death benefit rider comes in. It can give you an advance on your policy payout before you die to pay for essential expenses. You can learn more about these riders here.
What is accidental death and dismemberment insurance?
Accidental death and dismemberment insurance is another rider similar to an accelerated death benefit. With an accidental death and dismemberment insurance coverage, provides additional coverage if you were to lose a limb or become paralyzed. The rider has several unique benefits that you should be aware of, we detail the coverage plan here.