Understanding your needs is the key to obtaining the right coverage
One of primary goals that most individuals have is to protect their family. One of the ways to do this is through the purchase of life insurance. Determining whether or not you need insurance, how much and what type can be overwhelming.
Here are some points to consider:
Should you purchase life insurance?
Reasons to consider insurance:
- You are married, single income couple no children
- You have children
- You own a business
- The value of your estate exceeds the estate tax transfer exemption of $5.43 million
Reasons you may not need insurance:
- You are single and no dependents
- You are married, dual income, no children
- You are retired
Choosing life insurance
Because there are so many different types of life insurance policies, it can be difficult for you to determine what type of policy you need. The first question you should ask is whether you need term insurance or cash value insurance. For most individuals, term insurance is a better alternative because it provides for life insurance needs at a relatively low cost. It also provides affordable coverage during the years when individuals need life insurance most.
When looking for an individual insurance policy, you should consult with a reputable independent agent on what type of policy and how much coverage is appropriate for you.
Company-sponsored life insurance
If you are employed, you may have insurance as part of your benefits. Company-sponsored policies provide group coverage which is term insurance. The benefit is that the coverage is affordable however if you leave your employer you may lose your coverage. If you do have a need for insurance and are employed you should not count on your company sponsored life insurance as your only insurance. You could leave your employer at a time where a medical condition could prevent you from obtaining replacement insurance. It is a good strategy to purchase an individual policy in addition to your group life insurance.
Review your coverage periodically
Your insurance plan should be evaluated at least once a year and/or when there is a life change such as marriage, divorce, job change, a new child, etc. Your evaluation should include the cost and terms of your current coverage with a qualified professional. Also, take into consideration any discount eligibility. In addition, if you are employed, don’t forget to review your group policies.
Understanding your life insurance needs and obtaining the right coverage will give you the peace of mind knowing that your family is protected in the event of your untimely death.
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