5 Things You Should Do Before Purchasing Life Insurance
Looking to purchase a new life insurance plan? Here’s a quick but comprehensive list of things you should do before you purchase your coverage.
Review Your Coverage Needs
The first thing you should do before you purchase life insurance is understanding how much coverage you need. Think about things like how much of the family’s income you provide, how many people depend on you financially, and how your family will pay off your debts and final expenses if you pass away. Doing this will help you decide how much coverage you should opt for. You should ensure you purchase enough life insurance to protect your dependents financially.
Compare Different Types of Life Insurance Plans
There are various types of life insurance plans – term life insurance and whole life insurance are popular options. Term life insurance offers only life insurance coverage, while whole life insurance also acts as a savings instrument. The former last a specific number of years (usually between 5 and 30 years), while whole life insurance lasts for as long as you live. Research both types of plans to determine what type of coverage you will need.
Check if You Can Afford the Premium
Before you sign the policy papers, make sure to check whether you can afford the premium payments. If you can’t, you may want to consider opting for less coverage or a different type of plan.
Read Through the Policy Document Carefully
Do your premiums stay the same throughout the policy term or do they increase every year? Do you get a guaranteed payout at the end of the policy tenure? Read through your policy document and check if you can answer questions like these. If you can’t, consider getting in touch with your agent.
Review Your Life Insurance Plan Every Couple of Years
Your circumstances may change in a few years and you may require more coverage. In order to ensure your dependents are always adequately covered, it’s important that you check your policy coverage every few years.