We as humans love to plan everything. We love the comfort of a pre-planned schedule and we derive comfort from the idea of an ideal future. But even as we’re busy making plans for our lives there always comes a time when we think about life insurance – whether it’s the right time? Which type of insurance is beneficial? What exactly is whole life insurance?
Well, you’re not alone! But as you mull over all the options you’ll find that when it comes to buying whole life insurance, you’ll need some assistance.
Not to worry as we have curated a detailed list of steps to follow when going for whole life insurance.
What is whole life insurance?
Before you decide to settle on whole life insurance coverage, you need to know what exactly does it stand for. Whole life insurance is a type of permanent life insurance (also called cash value life insurance), which is one of the two major categories of life insurance the second major being term life insurance.
The biggest difference between these two categories is that term life insurance ends after a set number of years; it offers a death benefit and nothing more. Permanent policies like whole life insurance, on the other hand, cost more because they include an extra savings component, which is referred to as the “cash value.”
Choosing the right company
There are a plethora of companies that sell whole life insurance. While some are better than others, each one will appear to have something unique to offer.
You must begin by filtering out the clutter to make a list of companies that you deem to be appealing and then compare the pros and cons to make a final decision.
When comparing companies, the details could be daunting but their financial strength rating should be your top priority – this shows here the company stands at present.
You need to also find out what the dividend payout is and whether the policy will accumulate a cash value.
Asking the right questions
Even if you skimmed through the list of various companies to select the right one for you, you must ask the right questions. The last thing you want to do is purchase a policy without being sure of the whole life insurance benefits.
Prepare a set of questions beforehand when you set up a meeting with the insurance provider – this will help you make the right choice.
After landing on the preferred company, it’s time to layout the final details of buying a policy. You can decide on a policy by analyzing your personal needs and budget.
However, you need to be aware that the final price could change based on your medical exam.
You need to have a clear agenda on what will happen next. From there, review each step for potential roadblocks. For example, you may realize that a medical exam could turn up that you’re a smoker and that could result in an increased premium.
Activate your policy
After going through the tedious process, it’s finally the time to activate your whole life insurance. Make sure you receive the details of the policy one final time before you make the purchase.
Carefully go through the details such as the coverage, including the death benefit, as well as the premium. It’s alright to not move forward if you’re unsure about something and need assistance from the agent.
The last step is making your first payment. Speak with your company about your options for making payment – online, credit card, over the phone, check. Choose as per your preference.
Buying whole life insurance can seem overwhelming and that’s why you need to remember communication is key. You’re entitled to ask about any minute detail that seems to be clouding your judgment and get it cleared from your agent.
Hope the aforementioned steps help you find the right company and policy that makes you worry about the future a little lesser.