Looking for a life insurance policy can be overwhelming. With so many choices, it’s hard to know where to start. Here are some factors to consider while shopping for the right policy.
1. Immediate Payout Option
When looking for the right life insurance policy, make sure that your policy pays out 100% from day one if possible. Some of the insurance policies you see on TV or the ones that don’t require a medical exam have a waiting period that could be up to a couple years. You want to make sure your insurance starts right away.
Some life insurance policies also allow you to access cash or the accumulated value on your policy while you’re living. Confirm with your agent if the policy you’re looking at allows you this option.
2. Level Premiums
Some life insurance products are designed with flexibility when it comes to the premium. If your paycheck fluctuates from month to month, you may need a policy that offers you the choice to raise or lower your premiums to fit your budget. Some policies are designed to have premiums increase as you get older, while others are built with a guaranteed level premium. Make sure you get a policy that works for your budget and won’t surprise you later.
3. Conversion Feature
If you are leaning towards term life insurance, make sure you know if you’re allowed to “convert” your policy into a permanent one. Many times, this conversion won’t require you to re-apply or prove you’re still healthy.
For example, if you purchase a 20-year term but after 19 years you still want coverage and may have some medical conditions, this feature allows you to keep your coverage, where you may not qualify if you had to apply for a new policy.
4. Available Riders
Life insurance riders are an option to add additional features to your coverage. Since life insurance isn’t a one-size-fits all, they can help you get the best coverage for your needs. They may not be available on every life insurance policy, but some rider examples include:
Guaranteed Purchase Option
This rider allows you to periodically purchase additional whole life insurance up to the amount stated in the policy without a medical exam.
Waiver of Premium
If you experience a total disability that continues for a least 90 consecutive dates, premiums will be waived for the duration of your disability.
This rider accelerates a portion of your policy’s death benefit if you have been chronically ill for at least 90 days and are predicted to be ill for at least another 90 days. This is not a replacement for any long-term care you may have.
5. Underwriting Approval
When reviewing possible policies, make sure to ask out the underwriting process. Companies can range widely on how they price insurance risks like diabetes, smoking, international travel, etc. You want to make sure you are getting the fairest rate for your situation.
If you’re ready to purchase a life insurance policy, we’re here to help. Reach out to your Farm Bureau agent to start checking off the boxes that matter most to you.