Life insurance offers a sort of relief when it comes to ensuring that we leave our loved ones with something. Although, navigating your way through the multitudes of policies that are offered by different institutions is certainly a headache. You might find yourself asking, “What kind of insurance policy works for me?”, “What are the benefits of a policy, x over policy y?”, and “Can I afford this?”. Here are some examples of insurance policies below, and the cost-benefit ratio attributed to them.
Joint Policy Life Insurance
Joint Policy Life Insurance happens when both partners are covered in case of death. They will only pay out once, and you can have the option of taking the sum of money to cover expenses after the death of the first partner or continue to be covered as the second partner. The premiums associated with the death of the second partner will tend to cost less. However, if incomes vary between both partners you can choose to insure one partner for a greater amount than the other.
This would happen in cases where one partner’s death would create a large amount of financial instability, requiring assistance. This kind of policy comes with some flexibility but requires making tough decisions when being presented with a payout option. It offers coverage for both partners in the relationship, unlike a Single Life Insurance Policy. You don’t need to be married in order to take out this policy either.
Mortgage Life Insurance
Mortgages tend to cover the biggest deficit in the finances of families and the biggest cause for concern if they’re left to deal with the debt. If you’re concerned with covering the mortgage costs, Decreasing Term Insurance is a good option for you. If this sounds confusing, you can find more information on insurance and read these guides to enhance your understanding.
Money Expert defines decreasing term insurance as insurance that decreases in premium payments as your level of debt decreases. This is going to work best for you if you’re concerned about covering debt, but want to have a lower-cost premium associated with your insurance program.
You can always purchase Whole Life Insurance that has a payout that’s large enough to cover your mortgage expenses as well. You will be subject to higher premiums, and increasing cost depending on your situation, but you’ll know that your family will be covered for both your mortgage and other expenses such as your funeral.
Insurance Policies For Those Over 50
Even if you think you are above an age where an insurance policy might be an option for you, you’re probably not. There are plenty of insurance options for those who are above 50 years of age. You usually won’t need to deal with a medical examination, and your insurance premiums will be at a set rate. This way you won’t need to worry about increasing costs over the course of your policy.
You could choose to work with a plan with increasing life insurance if you’re fine with paying higher premiums. This will increase the amount of payout in contrast to the general inflation of the economy. You may have to pay your premiums for up to two years in order to be able to receive the payout in case anything happens to you.
Fortunately, the premiums that you have already paid will be received by your loved ones. Even if you’re waiting for the two years and making payments you’re already placing money towards taking care of them. Generally, the payouts for those over 50 are going to be decreased as well, due to age.
For many people age 50 or older, considering a burial insurance policy will generally make financial sense. These types of non-medical exam whole life insurance plans are recommended to those who wish to have a policy take care of their final expenses. Burial insurance can be easily obtained and helps millions of people achieve peace of mind knowing their family members do not have to worry about the costs of a funeral.
Convertible Term Insurance
Convertible Term Insurance allows the policyholder to change to a Whole of Life Insurance policy whenever they choose. This contrasts with Level Term Insurance which covers the policyholder for an agreed-upon period of time. With Level Term Insurance you won’t have an increase in your premiums, but you won’t be covered at the expiry of the agreed time.
You can switch to a Whole of Life Insurance policy with a convertible term policy, but the likelihood of paying premiums is higher. This is because you’re allowed to convert regardless of your health condition and the increased chance of the insurance company paying out a large sum is higher.
Life insurance can seem like a complicated ordeal, but it doesn’t have to be. Speak with your partner and decide what policy is best for both of you and who you want to look after. Talking with family members who have had experience with insurance is also an asset. Research various insurance companies and find a policy that will make sure that you take care of who matters most.
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