How to Choose a Good Life Insurance Policy
If you are someone upon whose shoulder rests the responsibilities of a family, you most certainly need a life insurance policy. In the unfortunate event, if and when something happens to you, you would want to make sure that your family is taken care of in your unplanned absence.
How to choose a good life insurance policy is a question that bothers you the most when you decide to get one. The choices in the life insurance policies are baffling, to say the least. Lots of factors have to be taken into consideration before zeroing-in on an insurance policy, as it is important to make sure that you have the right life insurance policy to meet all your needs. The inherent purpose of a life insurance policy is to ensure financial security of your family, in the event of your death. There are a lot of thumb rules when it comes to choosing a policy, not all of them click though.
Here are a few things you should keep in mind while choosing a life insurance policy:
Keep many options open: You don’t lay your hands on the first pair of trousers you see in a showroom, similar is the case with a life insurance policy, only the stakes are a little too higher. Don’t just settle for the first life cover you are offered. You should ask for number of quotes from the life insurance advisor or even consult more than one advisor.
The insurance amount: Now this is a tricky part. The amount of your life insurance policy and income protection insurance depends on lots of factor like your income, number of dependents you have, your debts, and your standard of living.
Type of insurance: Term Life Insurance or a Total and Permanent Disablement Insurance
Term life insurance is a type of insurance policy which has a fixed rate of payment for a limited period of time and a person gets a cash lump sum upon his/her death. The amount is decided at the time of preparing the policy and is generally chosen over the whole life insurance plan, as it is much less expensive. The policy is active as long as the premiums are paid by the insurer and lapses in case of no premiums.
Total and Permanent Disablement Insurance: TPD Insurance is a type of insurance that can take care of your needs when you are unable to earn an income due to an illness or injury that caused total and permanent disablement. It can be used to pay off outstanding debts, mortgages rehabilitation costs and monthly expenses as you won’t have any other source of income.
So, choose the life insurance policy you need after careful planning and thought. It is, after all, a life-long commitment and huge decision to make. Speak to quailfied broker like CCA Fp, Life Broker or Insurance watch to get great advice.