Q & A: Life Insurance Basics
Purchasing the gift of life insurance can trigger many questions and concerns. The best way to feel confident in your decision is to be as informed as possible. At Quotacy, we want to make sure all of your life insurance questions are answered, and you understand the terminology used in life insurance before you take the next step. If we missed something that’s on your mind, please don’t hesitate to call us, we are here to help.
What is term life insurance?
Term life insurance is a temporary affordable life insurance option, and it is the easiest type of life insurance to understand and own. You simply choose an amount of money to be paid to your loved ones when you die, and the policy will last for the amount of years you select. The payment remains the same for the entire length of the policy.
How much does life insurance cost?
The cost of life insurance is based on your age, state where you live, health, and family history. Term life insurance is the lowest cost guaranteed policy available.
What is the difference between term insurance and whole life insurance?
Term life insurance is an inexpensive level premium life insurance policy designed to last for a specific amount of time, like 10, 20 or 30 years. Needs change over time and there are many reasons why the life insurance you purchase today may not be needed in its entirety later in life. Whole life insurance is a form of permanent life insurance priced to last throughout the life expectancy of the policyholder. The higher premiums paid in the early years are saved as cash values which are used to help pay the costs of insurance later in life.
What is a good age to buy life insurance?
The best age to buy life insurance is right now. Every year that goes by, your price will get higher with age. When you have financial dependents or outstanding debt that would be passed along to your loved ones, you’re even more in need of life insurance. It’s never too soon to buy life insurance, it’s only too late.
Does everyone need life insurance?
No, not everyone needs life insurance. However, if there are people who depend on your income and would be negatively affected financially if you died, then you need life insurance.