So, you’ve made the decision to get life insurance and now it’s time to choose the right plan based on your circumstances and budget. There are so many options available and choosing the right type of cover is extremely important. The following are some questions that you must ask when chatting with a broker. Doing so will ensure you get the cover you need to feel safe in the knowledge that you’re fully protected should something happen to you.
How Much is the Premium?
The premium refers to the amount of money you pay the company in exchange for covering you. The amount you pay will vary depending on the plan and your personal details such as age, occupation and lifestyle. Premiums can usually be paid monthly or on an annual basis. If you do decide to pay monthly, a missed payment could result in a lapse in coverage. Tell the broker everything they need to know and ask for a detailed breakdown of the premium amount. If you’re buying online, be sure to check the terms and conditions of your policy before confirming.
What is Insurable Interest?
When it comes to life insurance, insurable interest is a basic requirement for taking out a policy. But what is it and what does it mean for you? The term refers to the possible financial requirements the beneficiary will have as a result of the loss of the person that is insured. Most companies will want to speak with the policy owner, the insured person, and the beneficiary to ensure there is a valid interest present. There are normally certain guidelines that need to be met. You can review a guide on insurable interest to learn more.
Is There a Waiting Period?
Most plans do have a waiting period. This term refers to the length of time you have to pay the premiums before you can make a claim. The average waiting time is two years so this is something to consider before choosing coverage.
Do You Need to Get a Physical Exam?
This is a requirement for the majority of companies. You will cover the cost of the physical exam and you can normally get it done with your local doctor. The results of the exam must be sent to your insurer before the plan comes into effect. If you need to get better healthcare this initial exam can help you understand the areas of your health that most require your attention.
What Type of Coverage is Available?
This is where things might get a little complicated. There are many types of policies, each giving different types of coverage. Even though your insurer will give you advice on which option to choose, it’s up to you to know what the differences are. Take some time to learn the fundamentals of term, whole, universal, variable, final expense, and group life insurance policies.
Can I Cancel the Policy?
In most cases, the answer is yes but there might be specific requirements that need to be met first. It’s important to note that some plans do have a cash value and you can sell your policy via a life settlement for a cash payout. The company that buys the policy from you will take over the premium payments and they will receive the payout when the insured person passes on.