Life Insurance

Income protection for your family.

What life insurance is right for you and your family?

Many people don’t want to think the reality of something possibly happening if they were to suddenly die or the need of large amounts of money for expensive medical treatments.

But the truth of the matter is that sudden changes in your life both tragic and unexpected can be devastating to your family due to the loss of life and income but what never changes are the expenses of that family.

Utility, mortgage and car payments won’t stop when someone dies or becomes terminally ill in the family, so you need to have something in place to protect yourself and loved ones if anything were to happen.

On this page, important information will be provided to you to help you become more educated on this topic, articles and recommended companies for family or individual coverage so you can get the most value for your money.

Life insurance 101

Here are some basic free education to know about when deciding on life insurance coverage on any policy.

Life insurance summary facts

  • It is a tax-free lump sum of money awarded to the surviving benefactor(s) after the policy holder or family member covered under the policy.
  • Affordable income protection to your family or loved one.
  • The money from a life insurance policy is used to pay expenses like:

     

    -Monthly mortgage or mortgage payoff

    -Utility expenses for family or loved one

    -Groceries and other living expenses

    -Fund college money for childrens further education

    -Funeral expenses

    -Pay off debts or settle accounts

Who needs life insurance?

To answer that, 2 questions you need to ask yourself:

Does anyone depend on my income like your family, spouse or do I have loved ones that will be affected by my death. Like your parents or guardians that might be left to be responsible for your final expenses or accounts. 

If you answered yes, then you need to have an asset or income protection like a life insurance policy.

Funeral expenses can reach as high as $9,000 to $20,000 in costs left to your loved ones. 

People don’t often think of the income loss your family would be without after your death. If you think surviving on one income to support a family is rough, you should already know the hardship you would have your family in if you were gone. There are also a lot more single parent homes these days, if you were to go away, would you have a financial estate to leave them so they are looked after when you are gone? 

What about financial obligations like living expenses like groceries, utilities, rent or mortgage expenses to name a few? 

 

 

Did you know that based on a 2019 report on the financial status of most families in regards to savings: 

Nearly 40% of adults today would have trouble paying a $400 emergency expense, and 12% would be unable to cover that expense by any means.  

Report by the US Federal Reserve Board

Types of life insurance policies

There are typically two types of life insurance that people commonly get. There is Term life insurance, which has a set lenght of coverage with a set amount paid out for the death benefit, You can always renew it for additional set period of time before the coverage lapse. 

Then there is Whole life insurance, which doesn’t expire and can be a tax deferred cash value. However, be careful with this coverage as most policies will only pay you either the cash value or the death benefit paid out. 

Then there is universal life insurance which offers flexible premium and coverage options. These life insurance policies offer investment values however, with the high fees and premium costs you won’t get much from the investment

Term life insurance has the lowest premium for set period of time that you need it the most. Most people choose Term and instead of using their life insurace as an investment, they simply invest the difference on a higher yielding investment fund. So lets take a comparison in the next paragraph for clarity.

 

Comparing types of life insurance policies

 

In general

NOTE: When looking at low cost premium life insurance, the lowest price is NOT always the best for your family. Be careful and research the provider before committing money to insurance. Just like any financial decision, it is smart to do your homework and check the service rating of that life insurance company through AM Best insurers rating company. 

What is AM Best? And why is it important?

AM Best is a US based and trusted credit rating agency that focuses on the insurance industry.

AM Best issues financial-strength ratings that measure insurance companies’ ability to pay claims on ongoing insurance policies and contract obligations.

If an insurance company has a bad rating on service obligations being held, you need not do business with them. Always check AM Best on insurance companies before committing money that you might not get back when you need it.

For a better understanding on the rating method, read more on this AM Best PDF file provided by the company for a better understanding.

Coverage and cost explained

The cost of coverage can be factored by the following with more detail below.

A good general rule to go by is that it is better to get life insurance at an early age to lock in an affordable premium you pay a month. Here are some keys to remember that can play a factor in what you pay a month.

You are never as healthy as you are than when you are in your youth. So, health and age play a role. 

Your medical history in your family, what is your current state of health when they do a medical exam during the application process for life insurnace. 

It also depends on how much of a death benefit you want to leave for your family. That being said, the policy details are a factor. Such as the type of life insurance, the coverage amount and the length of term the life insurance will cover. 

As far as price, obviously a two hundred and fifty-thousand-dollar death benefit for your family will be cheaper per month than a One million dollar death benefit for your family. It depends on how much you want to leave them, so they are looked after financially. Your last act of love as a parent and/or husband. 

 

How life insurance is priced? The premium rate each month

There are a few factors used as criteria to decide on the premium quoted for life insurance coverage on any policy.

The factors below are checked with every life insurance provider includes in their assessment to provide your quote and if you are in meet the criteria for coverage. Here is a little knowledge on this before hand so you are aware if you will get coverage or possibly denied.

Current Health

Life insurance is about the not only asset protection if you become terminally ill or die suddenly.

What more people don’t consider is the life insurance company. Obviously, if you are currently ill or have a condition that would risk being considered for coverage.

This will be the first factor life insurance companies will need to examine with a health check up. They will send someone or require you get a physical and  provide blood.

Current age

The cost of a life insurance policy increases in monthly premium rates the older you get. Meaning, if you wait until you are age 45 to get coverage, you will pay more than if applied for coverage at age 25.

The cost of a policy will increase at an average rate of 4.5 to 9% each year you postpone getting coverage.

Medical history

The company has to assess your health history and if the risk outweigh the investment. An insurance company will want to get your medical history and check your medical records.

The health of yourself and your family will be considered before acceptance of the application for coverage is considered.

Lifestyle, gender and the policy details

The lifestyle or occupation you work will be a factor.

  • What do you do for a living?
  • What are your hobbies? Aree they dangerous?
  • Are you male or female? Men usually pay more than women based on compariable policies.
  • The type of life insurance coverage you get will be another factor.
    • Term length
    • Coverage amount
    • Policy requirements

Choosing a life insurance policy

The one factor in this decision is how long do you need life insurance coverage? A life time or just for a period of time until you can be financially independent? 

You also want to consider how much coverage you want to have as a death benefit to be awards if you have an untimely death. 

The rule of thumb is it should be six to 8 times your annual salary as a general idea. You want to provide enough years of financial coverage to help your family for years until they are on more financially stable ground. 

For example, if you earn $60,000 a year then you should consider $360,000 to $500,000 in coverage. If you want to have a financial assurance for more than 6 to 8 years of salary you might consider a $1,000,000 death benefit you leave behind for your family. 

 

7 Steps to buying a life insurance policy

Here are some helpful steps you will need to do as a general guide to getting started on getting life insurance for your family.

  1. Check AM Best on the best life insurance companies out there and get a free life insurance quote. Compare, save and get the best dependable protection for your money.
  2. You will need to have an idea on the type of life insurance policy you want to get for yourself or your family. There are deciding factors such as the cost of coverage, the coverage amount, the length of time to process the application and the reputation of that company.
  3. Put in an application with the life insurance company of your choice. A licensed expert will be in touch with you soon to ask basic questions on health and what you want to afford for coverage. 
  4. You will need to take a medical exam more than likely as part of the application process. So be prepared to be honest and forth coming with your health and medical history. The medical exam will be free and comparable to a routine physical that can be done from home or at your place of work with a scheduled technician. It might also be worth your time to find out if you can qualify for a no-exam policy.
  5. You will need to complete the phone interview and answer some health and lifestyle questions. Be honest and disclose anything that they might need to know as the insurer will find out anyway with medical history. 
  6. The approval process with the life insurance underwriter will use the data provided both by yourself and the medical records to decide on a final premium. This process can take up to 4 to 6 weeks in some cases, while other insurance providers can take only a matter of hours to make a decision. 
  7. Last step will be for you to meet with the agent or complete the final paperwork sent from email and sign the policy. Life insurance coverage can begin the moment the 1st premium is paid majority of cases. 

 

Life insurance policyholders are commonly:

 

Family members

Spouses

Home owners

Business owners

Students

The fact of the matter is that life and kids are expensive and that should not fall on the shoulders of your spouse when you are gone. A life insurance policy on your family is peace of mind.

If you love your spouse you need to provide a financial safety net to help cover any final expenses, debts, financial obligations for an extended period of time or future financial plans like retirement.

If you are a home owner, you need to provide a way to cover one of the largest in debt and lenght of that debt to assist paying it off or providing a means to help afford it to the loved ones left behind.

Few people even consider the affect a family business can have if you die and your family and business partners are left with the expenses to keep the business going or pay off debts.

Not many students or family even consider the thought that if a loved one has outstanding student loans that were co-signed by loved ones or family, they may be on the hook to settle the debts.

What a life insurance death benefit can be used for:

Besides using the life insurance policies to help your family when you are gone. Living expenses, payments and debts. 

On average the death benefit paid out to the family can be used to cover the end of life costs like a funeral costs and medical debts. 

People might consider using the death benefit for long term financial plans liek retirement or long term care. 

Finally, charitable gifts are another common use of the benefit. You can choose a donation made out to the foundation or the organization.

 

If you ever have to file a life insurance policy

We can all hope it never comes to this, but chances are, life is unpredictable. There is chance in everything and life can change drastically without notice. For that reason, if you have or currently experiencing a death in the family, you are going through a difficult time and in grief. If this is the case, let me offer my most sincere condolences for your loss.

The state of mind in the grieving process can be difficult and almost in a state of frozen indecision. That’s ok, we are providing you a list of steps to follow to get you through this and file a claim. As sad as life can be, creditors and financial obligations do not stop or recognize grief.

For this reason, you will need to be prepared for the coming financial storm you will need to weather before a claim can be fulfilled and a check given to settle the financial burden from the loss of a loved one.

Such as funeral costs, remaining debts that now fall to you, the cost of living without the support your loved one provided when they were alive and making a life with you. I know, it is a lot to think on. So, let’s begin.

  1. You will need to contact the life insurance company or agent. TIP OF THE DAY: With that being said, it is good to have an up to date emergency folder of your accounts, contacts, passwords and other that are important for them to know. Always have your loved ones a way to access your accounts when you are gone. 
  2. Get MULTIPLE copies of your loved one’s death certificate so you can use it to get access to financial accounts, cancel subscriptions, tax purposes, turn off services and close accounts. 
  3. Fill out the paperwork with your life insurance company so they can get you processed for a check to be paid out. 
  4. You will need to specify how you will want it paid out. 
  5. Lump sum or installments. You can have the total amount awarded or have it paid out over time. There is no wrong answer, it depends on what works better for you and your family at the time. However, lump sum you have control of the money. With installments the money is under the control of the insurance company. 

Most people usually take the money as a lump sum and at the appropriate time, get with a financial advisor and invest it into a financial system that helps support the family for years to come.

 

10 Life insurance companies reviewed:

 

Company 1

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Company 2

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Company 3

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Company 4

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Company 5

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Company 6

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Company 7

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Company 8

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Company 9

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Company 12

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Frequently asked questions about life insurance

 

Can you have more than one life insurance policy? Article and response coming soon. 

Is the life insurance policy offered at work enough or should you have an individual policy for yourself and family? Article and response coming soon.

Can I get life insurance with no health exam and what are the pros and cons to that? Article and response coming soon.

What is the difference between permenant life insurance and whole life insurance? Article and response coming soon.

Is term life insurance a better choice for me and my family or life insurance that covers my entire life? Article and response coming soon.

What all is involved with a medical exam and what happens if I misrepresent something on the application? Article and response coming soon.

What is underwriting and how long does it take to know if you get approved? Article and response coming soon.

Where can I go to check the reliability of a life insurance or insurance company so I can make an informed decision on what life insurance company I go with? Article and response coming soon.

Where do I go if I am having trouble with a death claim and need to enforce the financial obligation? Article and response coming soon.

Is the premiums I pay for life insurance tax-deductable and is the death benefit taxed when awarded to my family? Article and response coming soon.

Key information about life insurance

There are a few factors that you should know about that can affect your life insurance premium. These factors will ultimately play a factor on what premium quote you will get with an insurance company. If you are familiar with these factors, you can skip ahead to the brass tax to compare from the top 12 life insurance companies and how to get a free quote.

So, in summary you will learn and have access to:

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What is Life insurance

What is life insurance and how will it benefit myself and my family. Not to mention, who are commonly life insurance policy holders. 

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Types of insurance provided

You can read on types of life insurance, the coverage offered, and how to buy life insurance.

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What factors decide premium

We want to provide a little working knowledge easily explained on the factors deciding a premium.

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Top 12 Companies

A comparable chart of the 12 top life insurance companies. And how do we know what the best life insurance companies are out there? COMING SOON

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Free quote

Access to a free quote contact number with available hours by clicking the link to one of the following companies recommended based on research. COMING SOON

Top 12 life insurance companies to consider

To help you out and reduce the time you would have to search each company and research their rating, I have included 12 of the most reliable and recommended life insurance companies for your viewing pleasure. Price and value being equal in factors of these selections. I wouldn’t recommend anything I wouldn’t consider in coverage myself. COMING SOON

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Company 1

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Company 2

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Company 3

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Company 4

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Company 5

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Company 6

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Company 7

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Company 8

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Company 9

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Company 10

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Company 11

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Company 12

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