What Is Life Insurance?
Life insurance is a contract between you and the insurance company. Essentially, in exchange for your premium payment, the insurance company will pay a lump sum known as death benefit to your beneficiaries after your death.
Your beneficiaries can use this money for any purpose of their choice. Often this involves paying daily bills, mortgaging or having a child through college. Having a life insurance safety net ensures that your family can stay at home and pay for the things you planned.
There are two primary types of life insurance: term and permanent life. Permanent life insurance such as full life insurance or universal life insurance can provide lifetime coverage, while term life insurance provides protection for a fixed period.
Best Life Insurance Companies
- Lincoln Financial
- Pacific Life
- Protective
- Prudential
- Transamerica
- Mutual of Omaha
- AIG
- AXA Equitable
- Penn Mutual
- Principal
- Cincinnati Life
- Northwestern Mutual
- State Farm
- John Hancock
- Minnesota Life
- Ohio National
- Midland
- Nationwide
- RiverSource
- Guardian
- Massachusetts Mutual
- National Life
- New York Life
- Allianz
- Ameritas
How to Find the Best Life Insurance Policy For You
With a wide variety of life insurance policies available, choosing the right policy can be a challenge for any buyer. Don't go it alone when trying to find the best life insurance policy. Financial advisors and experienced life insurance agents have the background to help you make the right decision based on your goals and budget.
See financial strength rating. A strong financial strength rating is more than just peace of mind that the company will no longer go beyond business decades. Insurers with greater financial strength may need to increase internal policy costs and premiums in response to challenging financial times.
Ratings are available from agencies like S&P and AM. The best, and are usually found on insurers' websites.
Choose life insurance as part of a larger financial plan. Here a financial advisor can explain life insurance options in terms of your larger personal financial goals.
Don't assume that insurers offer competitive pricing for everyone. Insurers want your business, but they all operate from their own playbook. Premiums can vary dramatically and, for cash value policies, cash value increases between companies and policies can vary greatly.
Keep in mind that a life insurance quote for a cash value policy does not indicate what you will actually pay over the years to keep the policy in place.
"Existing rules in some states and for certain products allow insurers to 'cite' lower premiums when charging higher costs - without disclosing that you need to pay extra premiums later to avoid defaults." Maybe, "warned Barry Flag, founder of Veralitic. .
Emphasize that any disclosure should include cost disclosure for universal life insurance. A life insurance quote indicates which bill you will be billed for, but does not tell you anything about the internal costs of the policy, such as expenses and fees, and the cost of insurance within the policy.
Emphasize that any universal life insurance illustration includes a detailed expense page or policy accounting page. Products with lower premium quotes may have higher internal costs, which may slow down your cash value increase.
Post a Comment
0Comments