Why get life insurance? How much does it cost and how much does it cover….
These are just some of the life insurance questions one may ask when hearing the words life insurance. In this post, we will go over each and one of them and provide you with the answer.
Onestoplifeinsurance.com helps people from all over the nation to navigate the challenging and often confusing world of life insurance. We are contracted with top insurance providers to offer the best possible rate based on each individual situation. We are here to answer any questions you may have and provide you with a professional advice.
Who can get life insurance?
To answer this questions, we would need first to clarify the difference between a policyowner vs. insured. A policyowner is an individual or organization, who is in control of the policy. He or she is responsible for paying the premium. The owner has the flexibility to select beneficiaries and make policy changes. The insured, on the other hand, is the person who is insured. The premiums are based on his or hers health and lifestyle. In many cases, the owner is the insured. However, there are instances when the owner is other than the insured, in case the insured is a minor for example.
So back to the questions, any legal resident of U.S. (U.S. Citizens, permanent residents, and non-immigrants, with some exclusions), who meets the underwriting guidelines for a given company, can secure life insurance.
Why get life insurance?
The answers to this question vary, but the most common one is to gain a peace of mind. We want to make sure that our loved ones would not suffer a financial hardship in an event of our unexpected and untimely death. Having the right life insurance gives us the confidence to know that we are not going to be a burden to our family. Life insurance can be one of the many ways we plan for the future. Many people can use the policy as an estate planning tool. Here is the time to mention that the proceeds from life insurance are in most cases tax-free for the beneficiary.
How much coverage I need and how much does it cost?
There are many options to fit individual’s budget and needs. It is important first to understand how much coverage you actually need. There are many ways you can calculate approximately how much coverage you need. One of these ways is using the LIFE calculator. By completing an analysis, we can ensure that the coverage amount is adequate and sufficient. At onestoplifeinsurance.com, we will guide you in completing these questions and account for what you already have in place to meet these needs.
L – living expenses (car loan, credit card balance, mortgage and etc.)
I – income replacement (usually 10x the annual income)
F – final expense (the average funeral in the United States vary between $5,000-$10,000)
E – education (college fund for the kids)
Unfortunately, a lot of people think they cannot afford life insurance. Therefore, they are either not insured or significantly underinsured. According to a 2010 research, over 80% of the people agreed that they need life insurance. However, only fewer than 45% actually have individual life insurance. The truth is that there are many options to fit one’s budget. An experienced agent can guide you through them and help you select the one that works best for you. It is important to select a policy or combination of policies based on your needs and what you can afford.
What kinds of life insurance are available?
There are 2 major categories of life insurance: term insurance and permanent insurance. As the name suggests, term insurance is for a specified period of time. It could be for as little as 1 year all the way up to 35 years.
For example, if a 25-year-old purchase a 20-year term, he or she would have coverage with level payments for the next 20 years. Once the term is up, based on the different companies, the policy would either cancel or the premiums would increase.
This type of protection generally offers the largest insurance protection for your premium dollar. Many insurance companies allow the option to convert a term policy into a permanent one, during the conversion period. This is usually done without having to prove insurability.
Keep in mind that companies calculate the new rate based on the age at the time of conversion.
On the other hand, the permanent insurance is just that, permanent. A policyholder can purchase a permanent insurance and have the peace of mind that he or she would not “outlive” the policy. Many of these policies build cash value, which the policy owner could use to borrow against.
At One Stop Life Insurance, we will walk you through the selection process. We will help you decide which kind of life insurance is best for you; compare similar policies from different companies to find which one is likely to give you the best value for your money. There are many factors to consider and simply comparison of the premiums is not enough.
Who can be the beneficiary?
A beneficiary could be anyone who might suffer a financial loss due one’s death. For example, a spouse, kids, business partner and etc. The policyowner selects the beneficiary at the time of the application process. In most of the cases, the beneficiary can be changed simply by requesting and signing one page document. There are cases when the beneficiary can be irrevocable and the owner can’t make any changes. This is usually a preferred option, when a life insurance is needed to secure a loan.
Do not hesitate to contact us if you need additional information or would like us to create a custom quote. We will walk you through the process of getting life insurance and guide you every step of the way. At onestoplifeinsurance.com, we strive to provide you with a personable customer service, while incorporating the conveniences of today’s modern technology. You don’t even have to leave your home. We can finalize the process via phone, e-mail or fax.