What really makes life insurance quite interesting and hard to grasp for new customers are the details. So to make things a bit clearer to you here are some basic facts you have to know about life insurance read more...
Choosing the right life insurance types
Ten life insurance facts
Life insurance can be confusing at times, especially if you're relatively new to the subject. As with any kind of insurance, life insurance policy is the contract between the policyholder and the provider, which represents an agreement to pay out a specified sum of money to the policyholder's family (or other persons, specified in the policy) in case of the policyholder's death. But that's in general. What really makes life insurance quite interesting and hard to grasp for new customers are the details. So to make things a bit clearer to you here are some basic facts you have to know about life insurance:
1. Life insurance for young persons is much cheaper than for the older. So it will cost you much less to buy a life insurance policy in your 20's than in your 50's.
2. The main purpose of life insurance is that the family members who have lost their income earner would be able to maintain financial stability in such circumstances.
3. In case of term life insurance, the policy has to be effective in order to gain any benefits in case of the policyholder's death. If the person passes away and the term has already expired there will be no benefits paid out.
4. The best way to calculate the amount of coverage your life insurance should carry is to evaluate how much money is needed to replace your income in a single installment.
5. Life insurance policies pay out the face value death benefit in case the policyholder passes away and a "cash in value" in case the policy is ceased.
6. People who smoke regularly can pay up to twice the amount of premium that non-smokers pay, because smokers have a shorter life expectancy and are considered as high risk customers.
7. You will have to go through a medical exam when applying for a life insurance policy. In case you have serious health conditions your rates will be higher, and if the illness is very serious some companies can even refuse your application.
8. Getting life insurance quotes is much easier if you search the web. There are numerous sites where you can get quotes form different companies faster than having a conversation with an insurance agent by phone.
9. Most insurance companies provide free life insurance quotes online at their sites. You are typically required to fill out an online form and within minutes you will get your quote.
10. When shopping for life insurance it's best to get as many quotes from different companies as you can and make a decision only after comparing them.