Choosing the right life insurance product can be a daunting task. With all of the options available, it is easy to become overwhelmed. While the various life insurance policies can seem complex, they all serve the same purpose. Life insurance policies pay out a lump sum of money in the event of the policy-holder’s death.
So which life insurance product is best for you? To learn this, it’s best to understand the factors that determine premiums.
Age
Your age is one of the most critical factors in determining your life insurance policy premiums. Generally, the younger you are, more life insurance products will be available to you. If you are under 40, and don’t feel the need for a life insurance policy, it is worth reconsidering. The assurance a life insurance policy provides is well worth the low premiums you will be paying as a young person.
Health
Nearly every life insurance policy requires medical information, either through an exam or a questionnaire. The healthier you are, the lower your premiums will be. Smoking makes a big impact on your life insurance premiums. If you consume nicotine, you will pay higher premiums. Click here for strategies to help you quit nicotine addiction.
When determining premiums, age is oftentimes one of the biggest factors in evaluating health. This is why purchasing a life insurance policy when you are young is so beneficial.
Desired term of life insurance
There are three types of individual life insurance:
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Annual Renewable Term is purchased for a period of one year, with the death benefit to be paid only if the insured were to die during that one-year term, along with the option to renew after the term period.
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Level Term Life guarantees a fixed premium for a given period of time, usually in terms of 10, 15, 20, or 30 years. Your premium is based on your age and coverage options, with longer terms being more expensive.
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Whole Life – As the most common type of permanent insurance, a whole life policy guarantees a death benefit for the lifetime of the insured as well as a cash value account for savings. Your premium remains constant throughout the duration of policy while payments over and above your premium are credited to your savings, which earn a fixed rate of interest.
Budget
Budget impacts the desired term of life insurance. More often than not, term life insurance is less expensive than whole life insurance. With that being said, when term life insurance expires, the individual is often faced with significantly increased premiums if they want to renew due to the fact that they are older than they were when they initially purchased the term life insurance plan.
Which life insurance provider is best?
Choosing a life insurance provider can seem just as daunting as choosing a life insurance policy. With all of the different providers offering plans, it’s easy to just give up and kick the problem down the road. That is a mistake. If you are looking for life insurance in Bourbonnais, Bradley, and Kankakee County, contact us today. We provide life insurance quotes through the highest quality providers, including Travelers and Nationwide. Our agents are more than happy to help you through the process of incorporating life insurance premiums into your budget and determining the type of coverage you need at a given age.
Request a quote to begin working with a friendly agent today.