Term Life Insurance Articles
Three Things No One Tells You About Life Insurance Rates
2010-06-04
The purpose of life insurance is to protect a person from financial losses resulting from their death. The death benefit can be used to pay off funeral expenses as well as large debts such as a mortgage, car payments, or other loans.
Term life insurance is a life insurance product that is valid for a specific period of time. This can be for 10, 15, 20, or 25 years. If you die anytime during this period, your beneficiary will receive the death benefit. Once this time period is up, your insurance policy will expire. You can choose to purchase another term insurance policy or you can convert your policy into a whole life policy, which means that it will be in effect for as long as you live. With either of these options, your life insurance costs will more than likely increase. This is because a life insurance rate is largely based on the age of the applicant. Insurance companies know that as we age, our chances of dying increase and so does the chances of filing a claim. To compensate for the cost of insurance claims, the insurance companies will raise premiums.
Insurance companies also base their premiums on a person's health status, medical history, and lifestyle. So, if a person is overweight, smokes cigarettes, or participates in dangerous activities such as rock climbing or car racing, they will be charged higher premiums. A piece of information that is not widely known is that if you change any of these factors, you can get a lower life insurance rate. If a person stops smoking or loses a substantial amount of weight, they can have their policy reviewed and have their life insurance cost reduced. They no longer pose a high risk to the insurance company.
Life insurance policy premiums can be paid in monthly, quarterly, or semi-annual installments, which are usually the most common choice for applicants. The premium is divided into smaller amounts that fit in better with most budgets. However, if a person chooses to pay this way, they are usually charged a service fee, which can amount to a lot of extra money. If you can, it is wise to pay your entire year premium in one lump sum. This will get the payment out of the way and save you on service charges.
Ask many questions when you purchase a life insurance policy to make sure that you are getting the most value for what you pay. Make sure the insurance agent reviews the coverage of the policy as well as all exclusions. Inquire about conversion options and how they affect your premium. Always ask if there are any ways that you can reduce your insurance premiums.
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The purpose of life insurance is to protect a person from financial losses resulting from their death. The death benefit can be used to pay off funeral expenses as well as large debts such as a mortgage, car payments, or other loans.
Term life insurance is a life insurance product that is valid for a specific period of time. This can be for 10, 15, 20, or 25 years. If you die anytime during this period, your beneficiary will receive the death benefit. Once this time period is up, your insurance policy will expire. You can choose to purchase another term insurance policy or you can convert your policy into a whole life policy, which means that it will be in effect for as long as you live. With either of these options, your life insurance costs will more than likely increase. This is because a life insurance rate is largely based on the age of the applicant. Insurance companies know that as we age, our chances of dying increase and so does the chances of filing a claim. To compensate for the cost of insurance claims, the insurance companies will raise premiums.
Insurance companies also base their premiums on a person's health status, medical history, and lifestyle. So, if a person is overweight, smokes cigarettes, or participates in dangerous activities such as rock climbing or car racing, they will be charged higher premiums. A piece of information that is not widely known is that if you change any of these factors, you can get a lower life insurance rate. If a person stops smoking or loses a substantial amount of weight, they can have their policy reviewed and have their life insurance cost reduced. They no longer pose a high risk to the insurance company.
Life insurance policy premiums can be paid in monthly, quarterly, or semi-annual installments, which are usually the most common choice for applicants. The premium is divided into smaller amounts that fit in better with most budgets. However, if a person chooses to pay this way, they are usually charged a service fee, which can amount to a lot of extra money. If you can, it is wise to pay your entire year premium in one lump sum. This will get the payment out of the way and save you on service charges.
Ask many questions when you purchase a life insurance policy to make sure that you are getting the most value for what you pay. Make sure the insurance agent reviews the coverage of the policy as well as all exclusions. Inquire about conversion options and how they affect your premium. Always ask if there are any ways that you can reduce your insurance premiums.
