Swiftrate Insurance

Here are some common Life insurance terms that may help you:

• Accidental death insurance: Also known as accidental death and dismemberment insurance, or AD&D, this coverage pays you or a beneficiary a benefit if you are in an accident that results in your being killed or dismembered.
• Annuities: An annuity is a type of insurance that either pays income after your initial investment (immediate annuity) or accumulates income (deferred annuity). Either of these types of annuities can be fixed (guaranteed) or assigned a variable rate that pays out based on the policy’s associated investments. Life insurance companies typically offer annuities to help people  obtain a stable income during retirement.
• Critical Illness Insurance: While not a life insurance policy, critical illness insurance is often available through life insurance companies. You might buy critical illness insurance (or CI) if you have a family history of heart disease or cancer in order to ensure that you have the financial resources to pay for your care if you are diagnosed with a severe illness.
• No exam life insurance: This is life insurance coverage that some companies offer without requiring a medical exam first. Typically, this option will be more expensive because without submitting the results of a medical exam to the insurance company, you are an unknown and potentially greater risk.
• Term life insurance: This is a life insurance policy that provides a death benefit only. Your annual premiums are locked in for a set term, such as 10 or 20 years. In the event that you pass away during this period, a death benefit is paid to your beneficiaries.  This type of life insurance is ideal for covering expenses that will eventually be paid off like loans.
• Permanent life insurance: This is a long-term life insurance policy, such as universal life insurance or whole life insurance, that includes an investment component and can cover retirement expenses in addition to providing a death benefit.
• Universal life insurance: A permanent life insurance policy with a “liquid” account that accrues cash value, as well as interest, with each premium you pay. You can take out loans as needed for unexpected expenses or opportunities, such as a home purchase. You also can pay more than the scheduled premium, or take breaks from paying premiums.
• Whole life insurance: Whole life is a permanent life insurance policy with an investment component that provides for your financial needs similarly to universal life insurance, but without the liquidity of the funds. This life insurance policy accrues a cash value and pays out at the end of the policy, if it is kept current.

Are you young and single?  Do you need life insurance coverage?  Lets think about that…  No matter what your age, you will have people you care about and those people will be responsible for carrying out your final wishes.  The average funeral is around $6000 according to the google search I just did.  Even a small life insurance policy would more than take care of that. Other issues to consider are shared no matter what your age and marital status: outstanding debt, student loans or child care. Evaluating these risk factors will be the first step.

The best reason for buying life insurance while you are young is locking in a rate.  Life insurance goes up every year you live under the sun.  Looking forward you will only require more life insurance so why not pay as little as possible for that coverage?

The most important thing about life insurance is to actually buy some, aside from that, determining how much your death benefit should be will top the list.  We find the largest expense your family will have in your absence is not your remaining mortgage or loans, its the income you can no longer earn.  A good place to start is 2 years of your current annual income.

Next determine what your outstanding debts are.  This would include student loans, home mortgage, vehicle loans etc.  If you have, or are planning to have children your life insurance death benefit should include child care.  Your spouse may need additional help in your absence.  One last thing to consider is will your children be able to get the education they desire if you are gone?  Adding their college education to a death benefit is a great thing to consider.

It is important to realize that some expenses will go away like loans and your mortgage so you can supplement a long-term permanent life insurance policy with a term life insurance policy to cover your loans that will eventually decrease.

Life insurance isn’t the most confusing type of insurance, there is only one possible claim that can be made.  If you pay your premiums and die within the policy term a benefit is paid out.  Of course adding riders to the policy can make things more confusing and if that happens it is a good idea to have an independent agent around to explain things.  Buying life insurance is a very personal decision and you need a good partner in the process to make things easy.

Should you buy term life or permanent life insurance?  Do you need a broker or can you get life insurance from an agency?  Should you buy life insurance coverage online or is that too risky?  You may want a policy that builds cash value over time or you may just want an inexpensive policy that is only active for a term of ten or twenty years.  Taking just a little time now to find the best life insurance policy can mean the world to your loved ones if the unthinkable occurs.