Few Tips to Buy Life Insurance

Life insurance is an integral part of your financial planning. Therefore it’s important to understand every facts and facets about life insurance before you choose any one. If you want to take the help of insurance adviser, sales representatives or broker to make your decision, chances are there to be misled. Therefore it’s always better to make decision yourself by knowing everything about life insurance.

These following tips will help you to have a basic idea about insurance industry:

What is whole life insurance?

Whole life insurance policy covers your whole life. You will not get any fixed end date for this policy. When the policy holder dies, the total value of the insurance which is known as death benefit is paid to the person or persons named as the beneficiary or beneficiaries in the policy.

What is term life insurance?

Term life insurance is a kind of life insurance that provides coverage for a specific period of time. It may be 1 year or 30 years. Therefore this is also known as temporary insurance. If the policy holder dies during the term, the policy pays the total cash value to the beneficiary or beneficiaries. But, when the particular term is over there is no hope of coverage if you do not renew the policy.

Few tips to buy life insurance:
 
1)  Your understanding of term insurance and whole life insurance is going to help you a lot. Because while buying you will have an idea that how the policy may cater your needs. With a clear concept of both types of insurances you are able to make your mind better.

2)  Which policy can be more beneficial depends on your situation. You may get more benefits by buying term life insurance where there are people who benefits by purchasing whole life insurance. So judge your situation at first to make a final decision.

3)  Usually sales representatives try to sale whole life insurance policies as this is more profitable for their company. So they always try to convince to buy a whole life insurance policy. But in your situation term life insurance may be more beneficial as compared to the permanent option. So don’t let them dominate your decision. Make your own decision to meet your needs.

4) The most advantage you enjoy when you buy a whole life insurance is that the cost of the premium you pay to the policy never increases. But in term policies the premium rate rises as you grow older.

5) Term insurance policies usually cover certain types of debts when the policy holder dies in between the term.

• Mortgage loans
• Consumer credits
• College education for children and
• Funeral expenses

 6) Sometimes independent brokers come out as more beneficial. You may get more options to them which a company may not provide. Before purchasing a policy from a company you may speak with an independent broker.

7) Term insurance provides just protection. They don’t involve any kind of savings component. But in whole life insurance policies carry savings components. And therefore whole life insurances are expensive. So when your financial condition is not well you are recommended to buy term life insurance as this is cheaper option as compared to whole life insurance.

8)  Don’t go for your broker’s recommendation blindly. Try to analyze your current financial situation to him and then consider what he advices. And this is not the end of the game. You must do a thorough research about the recommended companies and their reputation to make the best choice.

Before purchasing any insurance policy keep these above tips in mind. If you want to know more about different aspects of life insurance you can visit  lifeinsurancegroup.com.