Are you planning to purchase life insurance coverage as well?  If yes, how much should you ensure and insurance provider should you choose?

Should you get Life Insurance? Life insurance may not be for everyone.  If you don’t have dependents, then perhaps you may acquire other types of insurance policy.  Before starting your search for a Life insurance plan consider carefully if you need it.

Choose the right life insurance plan. There are two types of life insurance plans. The first is called Term Insurance and the other is Life Insurance.  Term involves only a specified period so the payment is more affordable.  For instance, you can be insured for the whole year and pay only a small price.  If something happens to you within that period, your beneficiaries can claim the amount of coverage from your insurance company.  Should you want to renew your coverage for the next year, you will be expected to pay the term price once again.

Nevertheless, renewing your term insurance within the next few years can also prove to be even more expensive than acquiring Life Insurance coverage.  This is because the price is bound to increase as the years progresses.  In addition, due the risks involved, the term price will also increase as the insured party gets older.

On the other hand, whole life insurance provides coverage for as long as the insured individual is alive.  The payment mode can be on a monthly, quarterly or yearly basis.  If you’re going to consider your total cost for the same number of years, a whole like insurance can prove to be a cheaper option than what you pay for term insurance.  This is because there is no need to renew your coverage each year so you don’t have to worry about additional costs or insurance rate increases.

Choose the right amount. How much coverage should you acquire?  The answer will depend on your lifestyle and needs.  If you have a lot of children, then you might need to apply for a higher amount of coverage.  On the other hand, if you only have one dependent, then perhaps you may opt for a lower coverage.  Don’t forget to consider your monthly insurance payments.  Would you be able to catch up with your payments for a long term?  Take into account your other financial obligations and calculate whether your monthly income will be sufficient to cover for all your expenses.

Shop around and compare deals. You can check out life insurance plans offered by various insurance companies from the internet.  You can also check out comparison websites that allow you to see multiple quotes from at least three or more insurance providers.  Aside from the cost, don’t forget to consider the reputation and legitimacy of the insurance company.  Needless to say, you’ll only want to partner with a trusted and stable insurance provider.

Beneficiaries

The primary purpose of acquiring life insurance is to ensure that your dependents or beneficiaries will have financial security after your death. You may declare your spouse or your child as the beneficiary of your insurance policy.  If you have children, you can declare all them as multiple beneficiaries.

Aside from your primary beneficiary, it is also recommended that you declare a contingent beneficiary.  Thus, you can elect your spouse as the primary beneficiary and your children as contingent beneficiaries.  Hence, in the event that the insurance holder and the primary beneficiary die, there will still be heirs who can benefit from the coverage.

There is also an option to declare your beneficiaries as revocable or irrevocable.  If you choose the first option, you will be able to change the name of your beneficiary at any time.  On the hand, if you choose the latter, changing the name of your declared beneficiary will not be possible.

Survivorship Clause

The survivorship clause states that your beneficiary will be able to claim the proceeds of your insurance if he/she survives you by a specified number of days.  Hence, if your primary beneficiary dies before the specified period, the proceeds will go to the secondary or contingent beneficiary.

Misstatement of Age Clause

When you apply for an insurance policy, your age will be a major determinant in how much premium you will be charged.  Dishonesty can prove to be damaging in this case.  If you lie about your real age in an attempt to lower you insurance payment, your insurance company can penalise you through fees or by terminating your policy.

Incontestable Clause

Aside from revealing your real age, it is crucial that you fill your insurance application only with accurate information about you. For example, your insurance company will require you to disclose specific details concerning your lifestyle.  Failing to disclose relevant details may cause your policy to be terminated.  Your beneficiaries may suffer the consequences of your dishonesty if your insurance policy becomes void.

Spendthrift Clause

If you worry that creditors of your beneficiary will go after the proceeds of your insurance coverage, this clause will be a protection.  The life insurance company may hold back the proceeds and release the money in instalments to make sure that your beneficiary can enjoy the financial assistance you’ve provided them with through your life insurance coverage.

Suicide Clause

If the holder of the life insurance commits suicide, the insurance company will only return the premium paid while the holder was alive.  However, the proceeds of coverage will not be released to the beneficiaries.

Grace Period

In case the life insurance policy holder fails to pay the premium, a grace period will be provided.  This gives the policy holder the chance to catch up with payments while continuously enjoying insurance coverage.

Reinstatement

IF the policy holder defaults from payment beyond the grace period, it is still possible to reactivate the policy. This is done through reinstatement or by paying all the previous outstanding premiums plus the interest rate.

Should you get a health insurance?  Surprisingly, many people have the wrong notion about this particular type of insurance.  Listed below are common myths that you should forget and the reality you can believe:

Myth 1: Only a few are uninsured. According to the U.S. Census Bureau, the number of Americans who do not have health insurance has reached beyond 41 million- a staggering number consider the importance of health.

Myth 2: Only the unemployed do not have health insurance.  On the contrary, many people who have permanent employment do not have health insurance.  The reason?  Their employers may not offer health insurance benefits or cannot afford to contribute their portion of the cost.

Myth 3: Not having health insurance is no big deal. Since none of us is immune from sickness or health related problems, everybody needs to have a health insurance policy.  If you don’t, hospitalization and medical bills can cause you and your family financial crisis.  On the other hand, having health insurance coverage gives you peace of mind that financial help will be readily available to you at any time you need it.

Myth 4: You can enjoy the same quality of health care even without insurance. Unfortunately, people who are not insured are most likely to skip regular physical examination or delay their visit to the doctor even when they are feeling symptoms of illness. Meanwhile, those who do have health insurance can monitor their health conditions – a crucial step in avoiding diseases and complications.

Myth 5: Your health has nothing to do with your financial success. In reality, your health has a huge impact on your financial situation.  You may find yourself stuck in deep debt in just a matter of months because you needed medical treatment.  You and your family can suffer from financial hardship if you fall and unable to work for a considerable time. As the popular adage goes, health is wealth.  One way to take care of your health is acquire health insurance coverage.

Myth 8: Only young people are usually uninsured. The facts prove otherwise.  According to surveys, an increasing number of people in the US who do not have health insurance coverage belong to the middle age and older bracket.

Myth 9:  I am a healthy person so I don’t need health insurance. As with other types of insurance, a health insurance policy is meant to protect you against unexpected circumstances which could affect your health.  Even if you are healthy today, there is no assurance that you will not fall ill within the next few months.  In addition, a health insurance policy comes with annual check-ups which help you to maintain good health.