Although permanent life insurance products such as whole, universal, and variable life insurance products boast a host of benefits, they are obviously not for everyone. However if you would like to guarantee your family and loved ones some sort of financial benefit in the time of your demise, purchasing any of the earlier mentioned life insurance products, is but a wise and sensible decision altogether.
If you are already decided to get a permanent life insurance policy, here are five important shopping guides that will enable you to buy the perfect one for your needs and financial situation.
- Only buy permanent life insurance when you have a need for it
In reality, not everybody who needs insurance should opt for permanent life insurance policies. You should not only buy one for pure investment purposes only. This is due to the fact that permanent life insurance policies require buyers to pay for an assortment of fees before putting them in force. If the associated fees and payments exceed the expected cash value that you can reap from buying permanent life, it may then be ideal to choose term life insurance instead.
- Check the Interest Rates
It is best for shoppers to examine the interest rates, especially if they are looking into buying universal life insurance. It is ideal to choose premium payments that only feature smaller interest rates ranging from 3% to 4%. In this way, you will be able to avoid very high interest rates in the future.
- Choose a Flexible Life Insurance Plan
Flexibility should always be assessed when choosing between life insurance companies. If you are still undecided to buy permanent life insurance, you may opt to choose a term life insurance for now. However, you will need to find a company that offers flexibility in that they give you the opportunity to switch to permanent life insurance in the future if and when the need arises in the future. This will allow you to continue on with your life insurance policy just right before your term life insurance policy ends. This will save you so much time since you will not have to shop around for yet another life insurance provider again and pay upfront fees, which can be a very expensive endeavour.
- Identify the Cover Amount
Ideally, you will need to set the coverage up to 10 times your annual income. If you have a family with smaller children, you may want to opt for more coverage to ensure your kids will have enough source of funding for their college education.
- More is Good
If your company has granted you coverage from its group life insurance policy, you may want to add more. Never rely on it since there might be a chance that you leave the company in the future. With this in mind, always get a separate life insurance policy. Companies do not prohibit consumers to only one insurance product, thus you or your family will not have problems during pay out.