Having life insurance is no longer just an option, it is a must. It is the fail-safe of every working person's career and the reflection of his hard work. It is his guarantee in ensuring a better future for his loved ones. Having too little of this is going to be a most unfortunate event especially if the person passes away earlier than expected and likewise, having too much is a burden while one is still living. Making the right choice and knowing just how much you're investing in your future is the most important part in getting insurance.
Here are the basic points that one should consider before acquiring an insurance package:
Do you actually need life insurance? Are you well-off enough not to need your family to count on the influx dealt by your sudden passing? Do you even have a family that will need this? Answer these questions first.
- Figure out how much insurance coverage your family will need. A lot of factors come into play when doing the math on this one. One of which is, how far along after you make your departure do you want your family covered and taken care off? Figure in the number of dependents, how far into education they are, how much savings the family has in the banks, and are there any properties or investments that can be liquidated later on? How much income are your kids going to be getting in the future (based on the most rudimentary assumptions). Remember that while you are paying for your future, you are also paying for the now. It is pointless to guarantee a better life for someone after your death when at the moment - the living conditions they have are below standard because of the insurance payments you're making.
- Choose the kind of coverage that best meets your needs. Remember that insurance will only protect your loved ones but s in no way an investment. Keep in mind that the younger you are the more likely that there are more things that have to be covered by your insurance, like college funding, house and car loans. Likewise, the older you get the need to cover for these are less or even not necessary since your kids might have already graduated and the house and car completely paid off. Create your "plan" to meet this. The longer into the insurance you get, the less the installments are.
- Do research on your potential insurance company. Check how they rate and fare among their competitors, compare values and standards. Check on track records and for any cases of faulty payments and cash-outs. Companies can range from the unstable newbie to the trademark copyrighted multinational corporation.
- Read and re-read the terms and conditions of the insurance policy first. Have a paralegal present and have the contracts reviewed first before signing. Before signing the contract, this is the time when you must ask the questions. Do not be afraid to question certain terms and policies that appear on the contract.
In the end, if all of these steps are done properly and the proper procedures have been followed, then you really have insured your loved ones.