Life Insurance 101: Everything You Need To Know

A lot of people these days do not have life insurance. The reason for it is that they think that the concept is too complex to be easily understood. It is either that or they think that it is too expensive. Little do they realize that it is much expensive in the long run to live without life insurance. However, before you jump into buying life insurance, there are still a lot of things you need to know about it.

What Is Life Insurance?

Getting life insurance in uk means entering a contract between you and an insurance company where they will be giving your beneficiaries benefits based on the term that you chose as well as the timely premium payments.

When you pass away, your beneficiaries can file a claim form in order to have access to the funds that your prepared through your life insurance.

How Life Insurance Is Issued

Your policy could either come in the most simplified form or is fully underwritten. Simplified forms are a lot easier and quicker to go through. You just have to answer questions about your health and then your life insurance will be approved. The downside of this is that the rate is usually relatively higher compared to an underwritten policy wherein you actually need to undergo medical exams before the insurance company can send their approval. If you were able to show that you are physically healthy, you will be given lower premium fees.

What Determines Your Premium Rate?

There are usually various factors that can affect your premium rate but age remains to be one of the most important determinants.

The general rule of thumb is that the younger you are, the lower your premium rate tends to be. Other than that, gender, location, marital status, family medical history, as well as lifestyle.

How Does One Buy Life Insurance?

People talk about the need for life insurance almost every day but how does one exactly buy one?

The first thing that you need to do is to determine your needs. Just because you decided to purchase buy insurance does not mean that all of your financial problems have been resolved for a lifetime. There are still some factors that you need to consider with regards to the kind of life insurance that you can afford conveniently. To do that, you should add up all of your debts, family expenses, as well as your final expenses. This will help you decide on a life insurance option and budget that is best suited for you.

Once you have determined your budget, you can ask for quotes from different life insurance companies. Choose the one that has a strong financial rating. You can then make an appointment with an agent. Select a life insurance policy that best suit your need and budget. You are going to have a lot of problems in the future if you choose a premium rate that you cannot afford.

Most importantly, you need to make sure you understand what you are getting yourself into. Ask your agent to sit with you as you read your policy. With that, your agent will be able to explain everything to you effectively and efficiently. Ask any questions that you may have.


Paola Garcia lives in Jakarta Indonesia. She is an associate professor in University of Indonesia and also managing Scoopinion at the same time. She is also fond of watching theatrical plays.

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